Tinkler's shrinking empire
A Hong Kong-based trustee company has put a receiver into Tinkler's base metals operations, Aston Metals - the largest remaining mining asset in Tinkler's private group
According to Tinkler, Aston Metals has been a "dormant, speculative investment near Mount Isa by the Tinkler Group and other shareholders". (This is a project that at one time Tinkler thought could be worth $75 million, according to media reports.)
"Our main joint-venture partner, Orchard Capital Partners in Hong Kong, is experiencing financial difficulties in one of its funds and as a result took the unexpected decision to place Aston Metals into receivership."
But there seems to be some dispute over which party is under most intense financial pressure.
Late on Tuesday Orchard Capital hit back at Tinkler saying in a statement: "Aston Metals and Mr Tinkler have received a number of notices over the previous 30 days requesting payment of the debt as per the rights of the secured creditor. This would not be a surprise for Aston Metals or Mr Tinkler."
It appears Orchard Partners is not part of Farallon, nor is the trustee company, Madison Pacific Trust, which is representing it.
It previously has been reported that Farallon was a lender to Aston Metals. This was not denied.
This fresh bout of Tinkler attention comes amid recent suggestions that he was thinking of a corporate comeback, or at least coming out of his self-imposed exile in Singapore. The chatter that Tinkler could re-emerge on the Australian corporate stage is certainly being hosed down by his media adviser.
Conventional wisdom in the business community says Tinkler is financially washed up. But in a March liquidator's examination Tinkler told the court the Tinkler Group Family Trust had assets worth up to $1.4 billion.
Farallon seized control in June of Tinkler's primary asset, a 19 per cent stake in Whitehaven Coal - cystallising a loss on a $US634 million loan to the Newcastle entrepreneur.
It's now about picking over the scraps of Tinkler's remaining assets, the value of which is debatable but could potentially be as much as $50 million - that's considered a glass-half-full valuation.
John Park and Quentin Olde of FTI Consulting were appointed receivers and managers to the Aston Metals Group on Tuesday, a situation that Tinkler's Australian spokesman was not aware of.
The receivers were appointed by Madison Pacific Trust in its capacity as Security Trustee over all the secured property of Aston Metals Ltd, a fully owned subsidiary of Aston Copper Pty Ltd and its subsidiary Aston Metals (Qld) Ltd.
Aston Metals is a base metals explorer with tenement holdings in the Mount Isa region of north-west Queensland. Aston Metals has five projects: at Walford Creek, Constance Range, Isa North, Isa West and Isa South.
Isa North, Isa West and Constance Range are joint ventures with listed mining hopeful Summit Resources. In Summit's most recent quarterly report it said the Isa North tenement soil surveys produced only "a low-level copper anomaly".
Isa South is a joint venture between Aston Metals, an unlisted company, Redmetals, and Xstrata but it had not yet been the subject of any exploration.
The highest value Aston Metals' projects seems to be Walford Creek, which underwent successful drilling campaigns a few years ago but is still considered to be fairly low grade and the subject of development opposition from the indigenous community.
That the lender has taken security over Aston Metals is evidence that there is some value in the asset. The receiver will now start the process of looking for a buyer.
Tinkler's ability to stay just out of reach of personal creditors attempting to bankrupt him has become almost as legendary as his ascendancy to billionaire status by the age of 35.
Frequently Asked Questions about this Article…
A receiver and manager were appointed to the Aston Metals group after its secured creditor enforced security over the company's assets. Madison Pacific Trust, acting as security trustee, appointed FTI Consulting partners John Park and Quentin Olde as receivers. The action follows notices requesting payment of debt and reflects lender steps to protect and realise value from the secured property.
Madison Pacific Trust acted as the security trustee that put Aston Metals into receivership. FTI Consulting partners John Park and Quentin Olde were appointed as receivers and managers. Orchard Capital Partners (Hong Kong) has been named in media exchanges — Orchard previously said it had taken the unexpected decision to place Aston Metals into receivership and also responded that Aston Metals and Nathan Tinkler had received notices requesting payment of debt.
Aston Metals holds tenements in the Mount Isa region with five projects: Walford Creek, Constance Range, Isa North, Isa West and Isa South. Isa North, Isa West and Constance Range are joint ventures with Summit Resources (Isa North soil surveys produced only a low-level copper anomaly). Isa South is a joint venture with Redmetals and Xstrata but had not yet been the subject of exploration. Walford Creek had successful drilling campaigns a few years ago but is considered fairly low grade and faces indigenous development opposition.
Receivership means the appointed receivers will assess Aston Metals’ assets, manage them and seek to realise value — typically by looking for a buyer. Lender security being enforced suggests there is some recoverable value, but the article notes remaining assets’ value is debatable and has been characterised as up to about $50 million on a glass-half-full basis.
The receivership is another blow to Nathan Tinkler’s once-large mining empire. Conventional wisdom in the business community described him as financially 'washed up', though Tinkler told a liquidator’s examination his family trust had assets worth up to $1.4 billion. Media chatter about a corporate comeback has been downplayed by his media adviser, and recent enforcement actions (including Farallon seizing other assets) have left much of his remaining asset base exposed to creditor action.
Farallon seized control in June of Tinkler’s primary asset — a 19% stake in Whitehaven Coal — which crystallised a loss on about a US$634 million loan to Nathan Tinkler. The article indicates Farallon had been a lender to Aston Metals in earlier reporting, though parties dispute which groups are directly linked.
Summit Resources reported in its most recent quarterly that soil surveys on the Isa North tenement produced only 'a low-level copper anomaly', suggesting limited near-term exploration upside from that specific survey result.
Watch for receiver updates from FTI Consulting on the sale process, asset valuations and any expressions of interest from buyers. Note that lenders enforcing security indicates recoverable value but the remaining assets’ worth is debated (the article referenced a possible up-to-$50 million valuation). Also monitor joint-venture partner statements (for example Summit Resources, Redmetals or Xstrata) for exploration results or changes to project plans that could affect asset value.
Call 1300 880 160
Start a chat
Schedule a call
