Wolverine Mine creditors urged to accept Yukon Zinc proposal
Not everyone liked what they heard at a meeting hosted by Yukon Zinc on Monday, but creditors are being advised to say "yes" to the deal offered by the company that owns the shut down Wolverine Mine.
One man walked out of the meeting in clear frustration and another questioned why the Yukon Government and other groups were getting paid back in full, while Yukon companies owed thousands of dollars were offered cents on the dollar. PricewaterhouseCoopers, the court-appointed monitor, told them the process is following Canadian law and Yukoners can't be paid more than other creditors.
It's recommending creditors sign off on this plan.
"It is the best option that is currently available and on the table and if there is a no vote and the plan is not passed I don't believe creditors will do as well," said spokesperson Mike Vermette. "For those reasons we're recommending that it's appropriate to vote yes."
Under the deal, creditors owed less than $5,000 will be paid in full, but for those owed more, the outlook is grim. Those that agreed to a restructuring plan by 5 p.m. on Monday were promised 11 cents on the dollar for money owed to them.
If they waited and restructuring plan passes, companies will get six cents on the dollar.
If the deal doesn't pass, companies might not see any money.
The deal would also see Yukon Zinc pay the Yukon Government in full for money owed for its reclamation security and taxes. The Ross River First Nation and mine employees would also be paid in full.
Robert Wills, a creditor with Above Ground Engineering, didn't like what he heard.
"Some creditors are left hanging and that's quite frankly distasteful because we had such high hopes for this China-backed company and all the way down the line to Yukon Zinc to actually pay their bills."
Jing You Lu, Yukon Zinc CEO, was at the meeting.
"Having the restructuring plan in action is probably the best alternative given the current situation otherwise the company could go bankrupt," he said through a translator.
