UPDATE 2-Elliott-funded Avocet to shut shop in face of high debt

* Co proposes members' voluntary liquidation

* Plans to pay creditors using remaining cash

* Shares have been suspended since May

* In Oct. said had enough funds to operate for next 12 months (Rewrites, adds details on operations, shares, debt)

By Pushkala Aripaka and Noor Zainab Hussain

June 28 (Reuters) - Gold Miner Avocet plans to close down its business after selling off its last significant asset in Guinea, the London-listed miner said on Friday, crumbling under mounting debt.

Avocet, which had warned in October that it could be broken up while it was still in talks with its largest shareholder Elliott Management to restructure its debt, said it would pay creditors with whatever cash remained.

The West Africa focussed miner has relied primarily on loans from Elliott since 2014 due to cash flow shortages resulting from a fall in gold prices and lower production at its Inata mine in Burkina Faso..

"Having considered all available options for the future of Avocet, the board has resolved that ... Avocet will be placed into a Members' Voluntary Liquidation," it said in a statement.

A Members' Voluntary Liquidation is a process by which the value of the assets of a company are realised and distributed to the company's creditors and members.

Avocet, which is also listed in Oslo, said Elliott, one of the world's largest activist investors, has released it from all obligations under their various loan agreements. Elliott had a 13.51% stake in Avocet as of May 31, 2018 according to Refinitiv Eikon data.

The miner, which has been making losses on an operating basis since at least 2013, had total debt of $32.2 million as at June 30, 2018, it said last October, most of which has been due to Elliott since 2013.

Avocet's gold mining and exploration business was historically located in South East Asia, but it moved to focus on West Africa after buying operations in Burkina Faso, Guinea and Mali.

It had recently relied on the success of its Tri-K project in Guinea but sold its interest in June for $21 million to Morocco's Managem to repay loans. It said it had no other significant subsidiaries or other equity investments after the sale.

The company floated on the London Stock Exchange in 1996 and exited Burkina Faso in 2017.

The miner's shares have been suspended since May, and at its last available closing price of 13.1 pence, was valued at 2.74 million pounds ($3.47 million) - a far cry from its peak value of 605 million pounds in 2011.

Last October, the company said that it had sufficient funds to operate for the next 12 months provided that the capital and interest on Elliott's loan will not have to be paid in the period.

Avocet plans to put its proposals to a shareholder vote at a general meeting on July 18.

($1 = 0.7889 pounds) (Reporting by Pushkala Aripaka and Noor Zainab Hussain in Bengaluru; Editing by Bernard Orr and Emelia Sithole-Matarise)