Aerison Group creditors will have an urgent meeting to discuss a bid from APCINFRA after a proposed arrangement with Pacific Industrial Company fell through.
Aerison Group creditors will have an urgent meeting to discuss a bid from APCINFRA after a proposed arrangement with Pacific Industrial Company fell through.
Formerly ASX-listed Perth contractor Aerison Group went into administration in June, a month after the company disclosed it failed to settle a $47 million dispute with Roy Hill Holdings.
Richard Tucker, John Bumbak and Craig Shepard of KordaMentha Restructuring were appointed as administrators to the various companies in the Aerison Group.
The administrators have sought court orders to hold a second meeting of creditors tomorrow, for creditors to decide whether to execute the deed of company arrangement with APCINFRA or have the Aerison Group companies be wound up.
In his judgment today, Supreme Court of Western Australia Justice Michael Lundberg has granted the relief sought by the administrators, saying the creditors should have the opportunity to consider the new proposal.
The administrators were finalising a deed of company arrangement with Pacific Industrial Company earlier this month but had reached a roadblock.
“Extensions of time have been agreed to facilitate this process,” Justice Lundberg said in his judgment.
“Unfortunately, the process reached an insoluble impasse and [Pacific Industrial Company] has informed the administrators it will not be proceeding with the [deed of company arrangement].
“This unexpected development has put the administrators, and the Aerison Group companies, in a difficult position.”
Under the Corporations Act, a company is required to execute a deed of company arrangement within 15 business days after the end of the meeting of creditors.
The failure to do so under the law would render the deed invalid and Aerison Group companies would be wound up, according to the judgment.
The judgment said the administrators have taken prompt steps to identify an alternative deed by Applied Pollution Control and submitted their court application with a certificate of urgency.
Applied Pollution Control, owned by Dylan Wadia, and Hasmukh and Pramila Wadia, is trading as APCINFRA.
According to the judgment, the alternative proposal from APCINFRA was materially different to the one with Pacific Industrial Company, involving a contribution of $5.08 million and creation of a creditors’ trust.
The trust will include the deed contribution, any debtors, other receivables and retentions owing to the companies, the proceedings arising from the claims against Roy Hill, cash held by the administrators, and all tax refunds arising from the pre-appointment and voluntary administration period.
In June, Aerison Group notified the ASX that the company had been under pressure from rising costs in the sector but that the real cause was its dispute with Roy Hill, that triggered a liquidity shortfall.