Struggling transport group McAleese (MCS) has extended its trading halt for five more days as it continues to review the financial impact of Atlas Iron’s (AGO) decision to shut its Pilbara iron ore mines.
According to The Australian Financial Review a meeting was held in Los Angeles last week between Atlas, its US creditors, McAleese and other contractors who want the iron ore miner to keep at least one mine open.
The 23% surge in iron ore prices in the past week or so have given the contractors hope that the creditors might be convinced to do at least that.
The problem with the surge is that no one is yet convinced its anything more than a one off bounce – it would have to be more sustained than what we have so far seen, for investors to become convinced it is not a passing thing.
McAleese first request for halt trading in its shares was due to expire today.
MCS & AGO 1Y – Will McAleese go the way of Atlas?
McAleese carries Atlas’s iron ore from mines to the export facility at Port Hedland, and has been pushing Atlas to keep at least one of its mines open. Logistics group Qube (QUB) is another contractor that would like to see Atlas keep its mines open.
“McAleese Group has held constructive discussions with Atlas and its stakeholders on a range of commercial scenarios with a view to supporting ongoing mining and haulage activities from Atlas’ mines.
“As these discussions remain ongoing, the company advises that its voluntary suspension is expected to remain in place for an additional period of up to five business days while this matter is progressed and the company assesses the operational and financial implications of any agreed outcomes,” McAleese said.
Meanwhile shares on Fortescue continued rising yesterday with the latest jump in iron ore prices. Fortescue’s shares ended up 16.3% at $2.57.
