KordaMentha attacked over sugar mill sale
CHINESE-OWNED Tully Sugar has slammed the administrator of the Proserpine sugar mill, KordaMentha, before a crucial creditors vote tomorrow, for failing to allow proper consideration of its $128 million takeover bid.
CHINESE-OWNED Tully Sugar has slammed the administrator of the Proserpine sugar mill, KordaMentha, before a crucial creditors vote tomorrow, for failing to allow proper consideration of its $128 million takeover bid.Former Queensland treasurer Keith de Lacy, vice- chairman in Australia of Tully's parent, the China Oil and Food Corporation (COFCO), said the members of the Proserpine Co-operative Sugar Milling Association were being short-changed by KordaMentha.The administrator had recommended a lower $120 million bid by Sucrogen, formerly the sugar arm of CSR that was bought by Singapore giant Wilmar International.Mr de Lacy called for the report to creditors to be amended to include an evaluation of the two bids."If I was a grower I would be very angry," said Mr de Lacy, "because they have been dudded to tune of $8 million."It doesn't sound much but that's 25 per cent of free equity," after debts of about $90 million were paid off, he said."I have never in my life seen an administrator enter into a 'no-shop' clause with a bidder when another bid is floating around. They ought to be trying to get an auction going."Mr de Lacy would not comment on the likely vote at tomorrow's meeting but noted Sucrogen was owed $15 million by Proserpine and would be voting for the deal as a creditor, as indicated in a report in yesterday's Whitsunday Coast Guardian.The sale to Sucrogen requires approval of more than half Proserpine's creditors, by value and number.If major lender Westpac did not vote, he said, "the Sucrogen vote becomes very important".Korda's administrator, Robert Hutson, said he had signed a contract with Sucrogen on November 16 because it was the best offer at the time."You can only sell something once," he said. Tully had "not put its best foot forward, as indicated by the fact that it increased its bid by $6 million on the day we announced the sale to Sucrogen"."We've got a contract in place. We're bound to perform under that contract. It's now in creditors' hands," Mr Hutson said.Separately yesterday, Thai sugar company Mitr Phol released its bidder's statement outlining its $245 million recommended takeover bid for the owner of Maryborough sugar mill, ASX-listed MFS Sugar.Mitr Phol said if its bid was successful it would "continue the employment of MSF's employees" and MSF would "continue to be managed wherever possible" by MSF's existing managers.