THE eyes of the investment world may well have been focused on the listing of construction giant Multiplex recently, but one of its owners and key executives has had other deals on his mind during the past few weeks.
While Multiplex was completing its offer period during the past fortnight, and then hitting the boards at a 13-cent premium to the $3.08 partly paid subscription price earlier this week, leading WA-based executive Tim Roberts was moving to increase his investment in the rock lobster business.
Interests associated with Mr Roberts are understood to have secured a key portion of the assets of failed rock lobster processor Bluewave Seafood, which was quietly dismantled through a series of trade sales last month.
After years of poor performances the former Fremantle Fishermen’s cooperative collapsed under a mountain of debt in September, owing creditors more than $6.6 million when the bank, HSBC, appointed receiver Jeff Herbert of PPB.
Although he would not comment on the buyers, Mr Herbert confirmed he had raised more than $5.5 million from the sale of the bulk of Bluewave’s assets, including four of the five processing licences, three depots, bait, gear and brands.
He said the sales had occurred quickly because the season started in mid-November, and trade sales at or around that time maximised their value.
Despite the timing, Mr Herbert said the asset sales were unlikely to cover the full exposure of the bank’s secured debt. Unsecured creditors amount to about $1.1 million when the receiver was appointed, about two thirds of that is fishermen while trade creditors make up the remainder.
“There will be no return to creditors or shareholders,” Mr Herbert said.
“All the proceeds will be repaid to the bank, which will probably suffer a shortfall.”
The receiver said the company had battled against adverse industry conditions, including “irrational” levels of competition, particularly during the past season.
“There have been estimates that the industry as a whole lost up to $20 million, some of the parties could afford to bear that loss,” Mr Herbert said.
Bluewave, which first hit financial difficulty in 1995, had sought to restructure and reposition itself to survive the crisis. It had changed from a cooperative to an unlisted public company in July 2001, appointed several independent directors earlier this year and announced a merger with small, listed rival Cervantes Seafood just weeks before its collapse.
But that had not proved enough.
“The bank moved in at a request from the directors. The directors were concerned about their own position,” Mr Herbert said.
While Mr Herbert remained coy about the purchasers’ identities, their names are an open secret in the industry.
Several industry sources said Mr Roberts featured prominently in the dismantling of Bluewave and its 56-year heritage, though several leading lobster companies are believed to have participated in scavenging scraps from the asset base of what was one of WA’s biggest lobster processors.
Mr Roberts has been linked to the purchase of up to three licences and associated depots in Geraldton, Lancelin and Fremantle – though some sources cast doubt on whether he had obtained the Fremantle licence, putting New Zealand-based investor George Stavrinos in the frame as a bidder for that asset.
It is understood that none of the deals has settled and the process is complicated due to the State Government’s heavy regulation of the ownership of lobster processing.
Mr Roberts, a second generation Multiplex executive responsible for development operations in WA such as those planned for the Cottesloe Hotel, Raffles Hotel and Nedlands Park Hotel, has long had an interest in the industry.
Despite declining to discuss his private business interests, Mr Roberts holds a commercial fishing licence and has a sizeable investment in the fishing side of the industry, controlling a considerable number of pot licences and running an operation in the Abrolhos Islands.
Moving into processing would make his fishing business one of the State’s few vertically integrated players.
It’s believed a fourth Bluewave licence has been bought by interests associated with Fremantle accountant Phil Giglia.
Kailis Bros is believed to have bought the various Bluewave brands and some trucks, while Lobster Australia, the rock lobster subsidiary of Kailis & France Group of Companies, has bought significant bait supplies. In an unrelated move, Lobster Australia recently bought Geraldton-based Batavia Coast Fisheries.
Most of the gear from the company’s supply store was sold at trade sales with the remaining merchandise and the majority of Bluewave’s fleet of trucks is expected to go to auction soon.
Mr Herbert said the Jurien depot had not been sold because it had been rezoned for tourism purposes and he could afford to be more patient to find a buyer.
A WA-based spokesman for Mr Stavrinos confirmed that the New Zealander had bid for most of the assets on offer but had lost to competing interests.
However, the spokesman said that Mr Stavrinos had secured a significant number of boats that had previously fished for Bluewave – boosting his fleet to 57.
He said that, by using 1,200 pots under his control, Mr Stavrinos was directing catch from this fleet to the processing operation of listed Cervantes Seafood, which was also a bidder for some assets.
This throughput will have made Cervantes one of the biggest players in the industry literally overnight, considerably adding to its own fleet of about 20 boats following a recent merger with Osborne Park-based INF.
Lobster Australia managing director Peter Fraser confirmed his company had bought the Bluewave bait supplies and had unsuccessfully bid for other assets.
“We were not the main game in town; we have just bought Batavia and so our bidding was on the cheeky side,” Mr Fraser said.
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