London Mining has entered administration.
The steel mining company, which suspended trading on Aim last week, said the board had decided to put the company into administration after a “longer than expected period of negotiations between the senior lenders and the potential acquirers of the Marampa mine, as well as a lack of liquidity due to the dramatic fall in iron ore prices”.
PricewaterhouseCoopers' Russell Downs and Peter Dickens were appointed joint administrators today.
It added that it would be working with PwC to maintain the Marampa mine as a going concern, although it could not confirm whether it would be successful.
City A.M. has previously reported that it was in talks with Indian company JSW Steel, and that it was expected the Sierra Leone-based mine would be transferred over to the firm in the event of it entering administration.
PwC said advanced discussions had taken place with "several potential bidders".
As well as the Marampa mine, the firm has completed feasibility studies outlining plans for the development of projects in Greenland and Saudi Arabia.
London Mining chief executive Graeme Hossie said: “Since first entering Sierra Leone in 2005, London Mining has established substantial operations at Marampa having brought back commercial mining and related economic activity to the region after 40 years.
“I salute all our employees for their dedication and contribution in creating what is now an important part of Sierra Leone's economy and ongoing development. I also applaud them for the ongoing leadership role our team has played within the private sector in Sierra Leone in helping address the challenges of the current Ebola crisis.
“The Marampa mine retains excellent fundamentals and it is our sincere wish for it to find the appropriate financial support to continue operating over the longer term."
PwC's Downs added: "The collapse in iron ore prices and the resulting impacts on this business have been very dramatic. Our focus is to ensure that a buyer is found for the Marampa Mine operations given it is such an important part of the Sierra Leone economy.
"We are liaising with key stakeholders and asking for a short window of forbearance as we look to conclude a transaction."
When the company ceased trading on Aim on Friday its share price was valued at 4.17pm.
In 2011 LON:LOND shares traded at more than 400p.