Conspiracy theory set up by potential Griffin buyer: CFMEU

A MAJOR union leader has savaged a recent press report that suggested administrator KordaMentha wants $A700 million for Griffin Coal, and he believes it is the work of a bidder trying to scare off rivals.
Conspiracy theory set up by potential Griffin buyer: CFMEU Conspiracy theory set up by potential Griffin buyer: CFMEU Conspiracy theory set up by potential Griffin buyer: CFMEU Conspiracy theory set up by potential Griffin buyer: CFMEU Conspiracy theory set up by potential Griffin buyer: CFMEU

A Komatsu 830E trucks being loaded by Griffin Coal's PC5500 shovels.

Blair Price

Construction Forestry Mining and Energy Union WA’s secretary of mining and energy, Gary Wood, is part of the committee of creditors, but also keeps tabs on the day-to-day operations.

He did not take kindly to a report in the Australian Financial Review last week which quoted an anonymous source as saying that KordaMentha wanted $700 million.

The administrator did not “return calls” to the reporters, although this is not surprising given that it has steered clear of commenting on Griffin in recent months.

KordaMentha partner Brian McMaster is leading the sales process for Griffin, and Wood said McMaster has never mentioned to “creditors or anyone” what the price valuation is on the coal company.

On the press report, Wood suspected there was “a bit of a conspiracy theory being set up by a potential buyer”.

“That sort of information is really about trying to drive the price down effectively,” he told ILN.

“Based on that, it could have an impact.”

In the AFR report, the source said the maximum “we would have paid was $150 million” for Griffin.

The report also discussed how Western Australia-based and “emerging miner” Atlantic Limited had teamed up with Griffin creditors and US investment groups Harbinger Capital Partners and Clearwater Capital to join the bidding.

Wood conceded he knew of lower offers “from some people” in regards to the recent round of binding offers.

While Griffin is continuing to export coal to India this year through Kwinana’s port, Wood said there was full support from the government and the Bunbury Port Authority for the development of Berth 14.

Atlantic expects to start production from its Windimurra Vanadium project, 600 kilometres north of Perth in 2011.

Wood said there could be a creditors meeting on Friday where a decision could be announced, while the closure of a deal could be in January.

Griffin’s total outstanding debt exceeds $1.8 billion.

In September, Wood said Griffin was producing about 1 million tonnes per annum of export coal and about 2.7Mtpa for the domestic market.

Griffin operates the Ewington and Muja mines near Collie, 220km southeast of Perth.

The business also owns the Bluewaters Power Station, which has about $1 billion of debt from a consortium of around 17 banks.

The collapse of Griffin contrasts with the strong acquisition and joint venture activity in the Australian coal space since the global financial crisis.

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