Boart Longyear on the edge
Boart Longyear on the edge

UPDATE 2.20pm: Boart Longyear has done little to alleviate shareholder concerns about its uncertain future by reporting no material developments to its strategic review announced earlier this year.

The driller’s share price collapsed to an all-time low today before the company called a trading halt.

Investors were responding to reports that Boart had begun talks with restructuring specialists to avoid bankruptcy.

In a statement to the ASX, the company noted the recent media reports but said restructuring advisors had always been part of the strategic review since it was first announced in late February.

“As the company has detailed in prior market communications concerning the review of refinancing and recapitalisation options, the scope of the strategic review has included all potential options reasonably available to the company,” Boart said in a statement.

It said it advisers continued to help the company with a range of options that remain under consideration with a number of third parties.

“The company will disclose material developments related to the strategic review at the appropriate time,” Boart said.

The world's largest drilling company has been hammered by a plunge in the level of exploratory drilling in the resources industry over the past few years as commodity prices cooled.

Boart admitted recently that more than two thirds of its fleet of drilling rigs lay idle.

Fears for the firm's future come despite massive restructuring, which has included the axing of about 3500 jobs over the past 18 months.

The company posted a net loss of $US620 million in 2013. It is also saddled with a massive $US600 million debt burden.

Only last week, the company was forced to deny media speculation it was headed for administration.

Boart Longyear is based in Salt Lake City in Utah but has a substantial presence in Australia, with its local head office in Adelaide. Its Perth office is in Wangara.

The company says on its website that it has a rich 120-year history that has “withstood the ups and downs of what we now know as ‘cycles’ in the industry”.

Boart Longyear listed on the ASX in 2007 after Macquarie Bank purchased the business the previous year. The $2.3 billion float was the second largest IPO on the ASX at the time.

The company operates in 40 countries and provides mining products to customers in more than 100 countries.

Boart shares eventually closed down 4.7 cents, or 34.82 per cent, at 8.8 cents after collapsing to an all-time low of 8.5 cents in earlier trade.

The West Australian

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