Creditors of Blue Sky Alternative Investments approve a “deed of company arrangement’’ to possibly salvage the firm
Blue Sky creditors have voted to give the Brisbane fund manager a second chance but shareholders of the one-time market darling are unlikely to see a cent.
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RISE AND FALL
There was a certain irony when creditors of Brisbane fund manager Blue Sky Alternative Investments gathered at Waterfront Place on Thursday to decide the fate of the one-time market darling.
Simply put, it rose and fell on Eagle Street.
Based on a recommendation from administrators Nigel Markey and Bradley Hellen of accounting mob Pilot Partners, those owed money approved a “deed of company arrangement” in a bid to resuscitate its fortunes rather than tipping it into liquidation.
Still, the decision was an ignominious milestone for Blue Sky, which had enjoyed its glory days just a few doors up the road in the scenic 46th level perch at 111 Eagle Street.
Despite the reprieve, Hellen told City Beat that he didn’t expect the company to start trading again on the ASX, where it was frozen last month at 18.5 cents after reaching a high of $14.99 in late 2017.
That’s bad news for the likes of founder Mark Sowerby, who still has 4.4 million shares in the stricken entity, as well as major stakeholders such as JP Morgan, HSBC, Citicorp, BNP Paribas and Wilson Asset Management.
Sowerby, of course, left in 2016 and subsequently cashed out more than $35 million worth of the once-valuable stock so he hasn’t been reduced to eating vegemite sandwiches.
US lender Oaktree Capital Management, which threw Blue Sky a $50 million lifeline last year, appointed both administrators and receivers after the company breached terms of the deal.
That’s despite Blue Sky having $158 million worth of assets and more than $40 million in cash in the bank, according to a report released this week by Markey and Hellen.
It also showed 32 staff are owed $1.8 million and another 30 unsecured creditors are chasing $906,000. The firm lost $39.1 million in the last financial year and haemorrhaged another $23 million through to the end of April, the report revealed.
Meanwhile, in case Markey and Hellen don’t have enough to do, they are also serving as liquidators of online booking group Bestjet, which sparked consumer outrage when it crashed last year with debts of more than $26 million.
They are gearing up for public examinations of key players in Federal Court next month, including disgraced aviation player Michael James and his missus, Rachel.
ANOTHER SNAG
The private equity tilt for restaurant equipment rental firm Silver Chef has hit another snag, creating additional uncertainty for the embattled Brisbane firm.
Silver Chef, founded by wealthy entrepreneur Allan English, revealed yesterday that talks between its financiers and Next Capital had failed to strike a deal on acceptable terms for the proposed $39 million-plus takeover.
But negotiations are still under way and Silver Chef has once again pushed back its exclusivity arrangement with Next, this time until June 30.
Coincidentally, that’s the same day that Silver Chef’s current bank waiver expires. The company has acknowledged breaching debt covenants last year and the waivers were conditional on it raising at least $45 million to repay loans.
The drama comes against a backdrop of more red ink, with Silver Chef suffering an $11.7 million net loss in the December half.
The share price has been in steady decline since hitting a high above $11 in late 2016. It closed yesterday at a mere 35.5 cents.
DEFLECTING A BULLET
Brisbane entrepreneur Wayne Ormond has deflected a bullet heading straight for his House Call Doctor enterprise.
The tax man sought to wind up the company last month over nearly $476,000 in allegedly delinquent GST payments.
But Ormond settled the matter and it was dismissed by the Federal Court last week.
His firm provides bulk-billed home visits to more than 200,000 Queenslanders every year and he says the firm his profitable.
Ormond previously launched and ran Refund Home Loans, which fell over in 2011 with debts of $12.5 million.
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