Fallout continues over HIH

THE number of victims of the HIH collapse continued to mount this week, among them were former directors Ray Williams, Rodney Adler and Dominic Fodera.

The three are being sued by the Australian Securities and Investments Commission over alleged breaches of directors’ duties.

ASIC has alleged that, in June last year, an HIH subsidiary paid $10 million to a company owned by Mr Adler, Pacific Eagle Equities Pty Ltd, which then used the money to buy HIH shares through a trust.

To make matters worse, HIH’s provisional liquidator Tony McGrath of KPMG has reveal-ed his latest findings indicate the collapsed insurer’s short-fall could be as much as $4 billion, leaving some creditors unlikely to getf more than 50 cents in the dollar.

Questions are now being raised regarding the company’s solv-ency as far back as 11998.

ANOTHER company hitting a spot of trouble in the past week is ISP Ltd, which went into voluntary administration.

The decision was made after ASIC raised concerns about the company’s solvency.

ASIC was planning to start a Supreme Court action against ISP Ltd to force the company to lodge its half yearly accounts, but this has since been suspen-ded pending advice from the new administrator.

TELECOMMUNICA-TIONS company OneTel is yet another company experiencing difficulties, calling a halt in share trading on Monday morning.

The company’s $132 million capital raising venture now looks in doubt.

DEspite THIS, Kerry Packer embarked on a buying spree in WA. Reports have emerged that Mr Packer has taken a near on 5 per cent stake in Burswood Casino. His close associate and former Crown Casino (a Packer-owned entity) boss Lloyd Williams has a similar shareholding in the WA casino. Mr Packer has also kicked a further $8 million in to WA medical consolidator Endeavour Healthcare.

He became an anchor share-holder in Endeavour’s $70 million share and option issue last year. It was also revealed, in a story broken by Business News, that a $300 million twin-tower office development is to be put on the remaining vacant land at Westralia Square, owned by Mr Packer.

WA’S take from the Federal Budget may improve if Premier Geoff Gallop can manage to secure a lucrative maintenance contract for the WA-ported Collins-class submarines.

Each refit is believed to cost around $100 million. However, the Federal Government seems keen to give the work to South Australian shipyards.

Besides the possible defence spend, there seems little in the Government’s political spend-ing that seems to be heading west.

Most of the tax cut measures brought up in the budget had been earmarked for announce-ment in 2001 anyway. The only unexpected measure was the allowance for businesses to claim full input tax credits for vehicle purchases. But possibly the biggest surprise from the budget came in the $1.5 billion surplus.

Most commentators expected the surplus, if there was to be one, to be much smaller.

BOARDROOM ructions at Anaconda Nickel continued with HIH director Rodney Adler resigning and embattled cheif executive Andrew Forrest gaining the backing of US-based Warbug Pincus Capital and international financing giant GE Capital. The funding is believed to be needed to deliver much-needed funds for Mr Forrest’s survival.

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