U.S. gold miner Allied Nevada files for bankruptcy

VANCOUVER, March 10 (Reuters) - U.S.-based gold miner Allied Nevada Gold Corp filed for bankruptcy protection on Tuesday, buckling under a heavy debt load amid weaker metal prices.

Allied Nevada, which owns the Hycroft open pit gold and silver mine in Nevada, said in a statement it was filing to restructure its debt, which stood at $543 million at the end of September.

Under the proposed restructuring, the company’s creditors and vendors are expected to be paid in full, the company said.

Although the Hycroft mine is expected to continue operating during the restructuring, RBC Capital Markets analyst Sam Crittenden said he did not “expect much, if any, residual value for shareholders after the process given the large debt load and limited free cashflow at spot metal prices.”

Allied Nevada’s biggest shareholder is Van Eck Associates, with a stake of 5.65 percent at the end of December, according to Thomson Reuters data. The California Public Employees’ Retirement System owns 2.3 percent of the company and Paulson & Co Inc. 1.2 percent.

Gold and silver prices are down around 31 percent and 48 percent respectively in the past two years. A number of analysts began raising concerns last year about Allied Nevada’s weak cash position, large debt load and short mine life.

Allied Nevada said secured lenders and noteholders owning or controlling more than 67 percent of its notes have committed to supporting the restructuring. It has also agreed to a $78 million secured credit facility that will be used to keep Hycroft operating.

Shares in the company, which as of Monday’s close had a market value of $108 million, were suspended from trading on the Toronto Stock Exchange and New York Stock Exchange on Tuesday morning. (Reporting by Nicole Mordant in Vancouver; Editing by Alan Crosby)