EFFORTS to salvage Rick Stowe’s failed Griffin coal and power businesses have slowed as administrators weigh up the appointment of advisers to manage the sales process.
EFFORTS to salvage Rick Stowe’s failed Griffin coal and power businesses have slowed as administrators weigh up the appointment of advisers to manage the sales process.
Administrator Brian McMaster from KordaMentha last month said he hoped to appoint advisers in the first week of March in order to kick off a formal sales process by the end of this month.
However, WA Business News has learned that the administrator had still not selected an adviser as of Tuesday evening this week (March 9).
Industry sources said KordaMentha had conducted a “fashion parade” of prospective sale advisers last week and was still assessing which firm to appoint.
It is understood that the list of prospective advisers includes a number of major firms, including Macquarie Bank, and smaller groups such as boutique Perth-based adviser Argonaut Capital.
However, sources said Macquarie could be conflicted, while Argonaut was considered an outsider due to its relative lack of scale.
It is understood that premium Perth advisory Azure Capital also declined to tender for the job as it is focusing on “buy-side” opportunities for the Griffin business. Azure founder John Poynton has previously floated the idea of consolidating Griffin’s coal operations with those of Collie neighbour Wesfarmers, and then spinning them off as an independent business.
Griffin Coal and Griffin Energy together owe about $1 billion to creditors, including $530 million to US bondholders. However, any buyer of the power assets will also have to deal with an additional $1.2 billion in debts racked up to fund construction of Griffin’s power stations.
Any buyer will also be faced with significant overstaffing levels at Griffin’s coalmines, which employ twice as many workers as Wesfarmers to produce the same volume of coal.
Mr McMaster has consistently maintained that interest in Griffin’s coal and power assets is strong, with more than 20 Australian and international groups having already registered interest in the sales process.
One prospective buyer expressed frustration to WA Business News at the slow progress in formalising the sales process, because until then it was not possible to start detailed work on any specific proposal.
It is understood that Mr McMaster has advised interested parties and bondholders to refrain from taking any action until KordaMentha has settled on the way forward.
The main Griffin assets potentially up for grabs are its Collie coalmines, its nearby Bluewaters 1 and 2 coal-fired power stations, and the Emu Downs windfarm near Cervantes.
