Pindan pays out Bankwest

Pindan Group’s offshore owner has provided a $17 million loan to pay out its secured creditor, Bankwest, as the collapsed construction group works on a restructuring for other creditors owed $75 million.

Singapore-based Oxley Holdings has provided the loan to Pindan, five months after the group was placed into voluntary administration.

The payout removes the prospect of Bankwest appointing receivers to Pindan.

Oxley has secured its loan by taking mortgages over three Pindan properties in Orange Grove, Osborne Park and Capel Vale. Bankwest previously held security over these properties.

A spokesperson for Oxley said the debt repayment meant other secured assets, including plant and equipment, would now be available for sale, for the benefit of unsecured creditors, but did not provide details.

The debt repayment comes one month after Pindan’s joint administrators – EY partners Sam Freeman, Colby O’Brien and Vince Smith – successfully applied to the Supreme Court for a second deferral of scheduled creditor meetings, to 28 October.

That provided more time for the financial restructuring to proceed.

The Supreme Court was told Pindan Group owed $95.5 million to secured and unsecured creditors, while 52 former employees were claiming $2 million.

Pindan Contracting owed more than $80 million to 417 secured and unsecured creditors, and $2.6 million to 48 employees.

Further substantial debts were owed by entities in the group, such as Pindan Realty, Pindan Projects and Moselle, that are in liquidation.

A large portion of these debts are owed to other entities in the Pindan group of companies; for instance, Pindan Group already owed $28 million to Oxley.

The total debt to external unsecured creditors is believed to be about $75 million.

Oxley is understood to be close to finalising a proposal for a deed of company arrangement (DOCA) that will provide for a partial repayment to these unsecured creditors.

It is being advised on the financial restructuring by Sydney-based Quentin Olde, a senior managing director with global insolvency firm Ankura.

The DOCA could avert possible legal action over the construction group’s collapse.

In a recent statement to creditors, EY said it believed the Pindan group was insolvent from March 2021.

This raised the possibility of a legal claim against Pindan Group's directors for insolvent trading.

EY also indicated that Oxley Holdings could face a potential claim in connection with letters of support it wrote last year confirming it would support all Pindan companies to remain solvent until at least October 2021.

Business News is a registered creditor of Pindan in relation to a small advertising contract.