There have been further developments at the troubled Bluewaters Power Station in Western Australia, with the new debt holders said to be considering refreshing their advisory team. Apparently, a beauty parade is under way to find a party to offer assistance.
Until now, McGrathNicol has been helping out the lending syndicate, but most of the banks it had been working with have since sold out.
The suggestion is that KordaMentha could be in the box seat to handle matters for the new financiers because it has worked on the asset in the past.
In July, almost all of the existing lenders to the coal-powered power station offloaded their debt for between 70c and 75c in the dollar ahead of a refinancing deadline in August. The only existing lender is understood to be Starwood Capital.
Banks bailed because they were not prepared to recommit to loans to coal-related assets due to environmental concerns.
The asset’s owner Sumitomo was offering to buy the debt for 66c in the dollar, but lenders found a better deal elsewhere.
The buyers of debt from existing lenders Westpac, NAB, ANZ, Societe Generale and Bayern have included Elliott, Davidson Kempner, Oaktree Capital Partners and traders such as SC Lowy, Bank of America and Deutsche Bank.
The face value of the debt pile was about $369m.
Most believe the lenders will 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.
Houlihan Lokey and law firm Clayton Utz is working for Sumitomo.
G+T has been working for the lenders and Japanese bank MUFG advised the Bluewaters company.
The Bluewaters power station at Collie, 200km south of Perth, was built by Griffin Energy in 2009 and has a total electricity generation capacity of about 430 megawatts.
The power station’s owners, Sumitomo and Kansai Electric, have been in search of funds for the asset they purchased for $1.2bn in 2011 from Ric Stowe’s Griffin Group.
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