Elliott hires law firm over Bluewaters Power Station

Bluewaters has struggled to refinance its loans due to its exposure to the Griffin thermal coal mine, which powers the asset.

Activist investor Elliott has hired law firm Corrs Chambers Westgarth in its quest to control the destiny of the Bluewaters Power Station.

Elliott was recently among a number of distressed debt investors that purchased loans from the original lending syndicate to the coal fired power station in Collie, 200km south of Perth.

Others include Soliton Capital Partners, Oaktree Capital Management, Deutsche Bank, SC Lowy and Bank of America

The only original lender in the syndicate that still has an exposure is Starwood Capital.

It is understood that the firm’s head of Restructuring, Insolvency and Special Situations in Australia, Cameron Cheetham is the lawyer working for the US-based Elliott.

Elliott is the activist investor that shook up mining giant BHP and lobbied for the sale of its US-based shale gas portfolio and abandoning its dual-listed structure.

Mr Cheetham is known for his connections to activist investors in the US such as Elliott.

He is currently working for Virgin Australia bond holders, owed about $2bn following the collapse of the airline into voluntary administration.

He was also the lawyer that worked for the highly aggressive US-based hedge fund Black Diamond amid the restructure of mining services provider Emeco several years ago.

Bluewaters has struggled to refinance its loans due to its exposure to the Griffin thermal coal mine, which powers the asset.

As a result, Japanese owner Sumitomo offered to buy out the lenders at about 66c in the dollar, but they instead found other buyers for the loans at between 70c and 75c in the dollar.

The face value of the debt pile was about $369m.

Most believe the game plan for the lenders will be to bring together the power station and the Griffin Coal mine. It provides the fuel for the power station, which supplies about 16 per cent of Western Australia’s electricity.