Tinkler declares war on Whitehaven

In his letter, Mr Tinkler, who is Whitehaven's largest shareholder with a 19.4 per cent stake, attacks the company for the destruction of $2.3 billion in shareholder value since April 30, when its shares have fallen 44 per cent to yesterday's close of $3.

Mr Tinkler also criticises under-investment in Whitehaven's marketing division, and a lack of disclosure, including the reported "collar" arrangement over 8 million shares owned by the managing director, Tony Haggarty.

Such "collars" are entered into to protect against share price volatility and Mr Haggarty's deal was disclosed to the stock exchange on September 25.

Mr Tinkler said Mr Haggarty's arrangement was entered into "only 35 days prior to a material downgrade".

He continued: "It was not until the Tinkler Group, on behalf of all shareholders, urgently sought clarification on a number of financial and operational matters that the board [last Friday] deemed it necessary to disclose material downgrades, the potential retirement of ... Tony Haggarty, and the indefinite suspension of production at Sunnyside."

Mr Tinkler acknowledged the Whitehaven resolutions may be carried but said he wanted to send a clear message to the company, which he did not expect would generate any profit this year.

"Since the merger with Aston Resources, Whitehaven has had limited development success, has torn through nearly half a billion dollars, and drawn down previously unextended bank facilities, and I believe it has also incurred significant liabilities through take-or-pay contracts due to its inability to develop projects on time and on budget," he said.

Mr Tinkler is believed to be under significant financial pressure particularly over the falling value of his stake in Whitehaven, which is security for debt owed to lenders including Farallon and Credit Suisse. The full extent of Mr Tinkler's debts has not been confirmed but corporate filings indicate his maximum liability may be as high as $638 million, although his spokesman has said the true figure was "a mere fraction" of that amount. There has been media speculation Mr Tinkler is seeking to sell down his Whitehaven stake or refinance the loans against it.

The settlement of an $18 million property dispute between Mr Tinkler's Ocean Street Holdings and Mirvac subsidiary Domaine Steel River was confirmed in the NSW Supreme Court yesterday.