The Supreme Court of Western Australia has approved the transfer of Panoramic Resources’ shares to Zeta Resources (ASX:ZER).
On 25 October, the administrators applied to the Supreme Court for leave to transfer the shares in Panoramic to Zeta (or its nominee) under a deed of company arrangement (DOCA) previously approved by creditors.
Yesterday, Justice Jenni Hill granted leave for the share transfer to occur, which was unopposed.
As a result, all Panoramic shares will be transferred to Zeta for nil consideration. This was supported by an independent expert report, which found that the shares in Panoramic had no residual value as Panoramic’s liabilities exceeded its assets by about $27.16 million.
In delivering the judgement, the Supreme Court was satisfied the shares had no residual value; there was no prospect of the shares attaining value within a reasonable period; and in those circumstances, the transfer of shares would not unfairly prejudice the interests of the members of Panoramic.
With this condition precedent of the DOCA satisfied, the administrators will seek relief from the Australian Securities & Investments Commission (ASIC). If granted, this is expected to satisfy the final condition precedent to enable the implementation of the DOCA and the transfer of Panoramic’s shares.
ASIC has provided an in-principle decision to grant that relief, subject to the administrators obtaining section 444GA orders, which hurdle was cleared with today’s decision.
FTI Consulting Senior Managing Director Daniel Woodhouse says the sale of Panoramic to Zeta is the best possible outcome for creditors, given the current Australian nickel market.
“Seeking a declaration for a transfer of Panoramic’s shares is not a decision the Administrators took lightly,” Woodhouse says.
“However, we have run a transparent, well publicised and thorough sales process, concluding with a binding proposal from Zeta Resources.
“Given the currently depressed nickel market, selling a nickel company at the moment is no easy feat. The DOCA with Zeta provides the best possible outcome for everyone interested in the Company and we are pleased to provide a return for creditors, which is a far superior outcome to the alternative, which is a liquidation.”
In January, the administrators in charge of Panoramic called a halt to mining as the nickel price continued to plummet.
About 350 workers and contractors lost their jobs when the company’s Savannah mine in Western Australia closed.
Write to Adam Orlando at Mining.com.au
Images: Panoramic
