Sharechat Logo

Solid Energy creditors to get at least 60c in $1 as assets sold

Tuesday 14th November 2017

Text too small?

Solid Energy New Zealand's creditors will get at least 60 cents in the dollar after the failed state-owned enterprise's mines are sold, up from the previous range of 45 cents to 55 cents.

The state-owned enterprise, operating under a deed of company arrangement, has sold all but one of its assets, with the Stockton export coal operation and two Waikato mines sold to BT Mining, a joint venture between Bathurst Resources and Talleys Energy, in August. Spring Creek, the only mine not sold, is currently being closed. 

Solid Energy was placed in voluntary administration in 2016 after concluding it had no realistic prospect of refinancing $239 million of debt facilities due to mature in September 2016. The company's downward spiral began in 2013 when slumping global coal costs exposed its commercial error in carrying substantial debt on its balance sheet.

The sale to BT was finalised outside of the financial year, and chair Andy Coupe said that once remaining sale proceeds are collected and final costs are taken into account, creditors should see a return of approximately 60 cents in the dollar, which could be higher based on post-settlement coal prices.

Last October, administrators Brendon Gibson and Grant Graham of KordaMentha said they expected returns from the asset sales to be between 45-cents-and-55-cents in the dollar, higher than the top end of the 35-to-40-cents range initially estimated for a managed sale.

Pike River Mine and East Mine were not included in the asset sales programme. Solid Energy said it is waiting to be advised of the new government's plans for re-entry, and the assets will be disclaimed to the Crown on solvent liquidation or before, if the Crown wants to take over the site earlier.

The company is on track to go into solvent liquidation in March 2018, Coupe said.

(BusinessDesk)

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ dollar heads for 1.2% weekly fall as greenback finds favour on rate hike view
Seeka annual profit falls 44% on lower kiwifruit volumes, impaired banana business
Pyne Gould first-half profit gains on Wilaci settlement
Steel & Tube may be interested in Fletcher assets if review prompts sales, CEO Malpass says
Northport upbeat on regional fund, helps lift Marsden Maritime 1H profit 5.4%
Countdown supermarkets 1H earnings fall 7.7% on rising cost of investment
Regional growth fund trickle today becomes avalanche in election year
Port of Tauranga's Cairns says export growth in 1H suggests 'economy in not too bad a shape'
NZ quarterly retail sales rise 1.7% in 4th-qtr, adding to upbeat electronic cards data
Kiwibank first-half profit sinks 32% as IT costs mount

IRG See IRG research reports