An eleventh hour move by Pindan's Singaporean owner to almost double its DOCA proposal to $12.3 million will lead to an adjournment of a planned creditors' meeting tomorrow.
An 11th hour move by Pindan's Singaporean owner to almost double its deed of company arrangement proposal to $12.3 million will lead to adjournment of a planned creditors' meeting tomorrow.
In a letter to creditors this afternoon, administrators of EY told creditors the submission of a revised Deed of Company Arrangement and new "documentation" meant it was appropriate to immediately adjourn Thursday’s creditors' meeting.
Oxley Holdings lodged a revised DOCA for the creditors of Pindan Group earlier today, specifically for Pindan Contracting, increasing the total contribution by $5 million.
The revised deal includes an increased contribution for Pindan Contracting creditors, as well as other concessions from Oxley to increase the return.
Almost half of the $12.3 million has been set aside for employees of the group.
Administrators are expected to revise their recommendations and adjourn the meeting until mid-November.
Speaking on behalf of Oxley, Ankura senior managing director Quentin Olde said the revised proposal had the support of a number of major group creditors and, therefore, the completion risk had been significantly reduced.
"This means there are strong prospects it can be successfully implemented and employees can be paid in full before Christmas," he said.
It is understood a number of parties have also provided further documentation in support of claims against the company likely to impact on the outcome of the vote.
Administrators told creditors the adjournment would allow time to review the new information, model the potential outcomes, and determine the best outcome for creditors.
The news comes a fortnight after Oxley first approached Pindan Group’s administrators with an arrangement which included $7.5 million for employees and creditors before Christmas.
The original deal comprised $4.5 million for employee entitlements, more than $1.5 million for creditors and $1 million for a release from the other subsidiaries already in liquidation, as well as the coverage of associated costs.
Though the original deal would have provided employees 100 cents in the dollar on all claims, including leave, redundancy and superannuation, other creditors would receive $1,500 per claim.
The proposal was set to be presented during the second creditors' meeting on Thursday, but administrators had recommended rejecting the DOCA in favour of the winding up of Pindan Contracting.
That would have allowed administrators to pursue Oxley for damages over the letters of support it wrote last year in which it claimed it would support the group to remain solvent until October 2021.
The second creditors' meeting has already been adjourned several times, with extensions granted by the Supreme Court to allow further negotiations.
EY was appointed as administrators of three Pindan entities and liquidators of a further nine on May 18, after Business News revealed the company was facing financial trouble.
The multi-disciplinary construction group collapsed owing secured and unsecured creditors and employees more than $97 million, leaving the business's 80 active projects, 280 staff and hundreds of subcontractors and trade suppliers in limbo.
Business News is a registered creditor of Pindan in relation to a small advertising contract.
