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Central Exchanges gets $19 million pay day

READMISSION to the Australian Stock Exchange, probably as a mining player, is key on the agenda for suspended technology stock Central Exchange after it received $19.05 million from Minara Resources (formerly Anaconda).

Central Exchange company secretary Victor Ho said readmission to the ASX was the main plan for the company, with March the key date.

There had been speculation that Central Exchange would be wound up and the money would be redistributed to shareholders.

The main beneficiary of that would have been Queste Communications, a company chaired by small cap stock raider Farooq Khan, which has a 49 per cent stake in Central Exchange.

Mr Ho said winding up the company was not on the cards.

"We want to do something more positive than that," he said.

"There may be a small capital return to shareholders but we want to keep the bulk of our windfall intact.

"The boards of both companies have agreed that the two companies can survive and thrive together."

One of the main options facing Central Exchange is a return to its old mining routes.

The company was one of the many miners that turned dot.com during the technology boom of the late 1990s.

Central Exchange has been in discussions with the ASX about readmission since late last year when the Minara payout looked like becoming a reality.

Mr Ho said the process of relisting would be much easier, given the $19 million Central Exchange had in the bank.

"Most companies that have been suspended from trading usually need to find new investors to raise the funds needed to get back on the ASX," he said.

"With us that’s not really a problem."

Mr Ho said the company was still waiting for communication back from the ASX about what was required to get the company relisted.

"Once that happens we’ll be ready to get the paperwork flowing," he said.

The payout is the result of an eight year old deal between the two companies back when the then Anaconda was getting started and Central Exchange was known as Central Bore.

It is the result of legal action between the two companies over a disputed payout for the Murrin Murrin deposits that dates back to 1996.

The dispute was heated and led to blows being exchanged between former Anaconda managing director Andrew Forrest and Central Bore shareholder Peter Salter.

The court-struck deal involved a complicated process that was linked to the London Metal Exchange price of nickel.

But for the recent spike in nickel prices, many investors and analysts thought the payout would never come to fruition.

However, on December 18 Minara announced to the ASX that a payment of $19.05 million was due to Central Exchange "under the terms of a settlement agreement".

The payment was officially made on January 12 on behalf of the Murrin Murrin Joint Venture participants.

Minara company secretary John Quayle said the $19 million payout would have little impact on the company.

"We’ve had it there as a contingent liability since 1996," he said.

Minara’s part of the payout came to $11.4 million, with the remainder paid by its Murrin Murrin joint venture partner Glencore.

Mr Quayle said the payout had been funded from the company’s cash flows.

 

 

 

 

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