The $1 billion fallout of north Queensland miner Kagara intensified yesterday with calls for a parliamentary inquiry into the collapse, legal action pending and attacks on the corporate regulator, ASIC.
Update from 12 August 2013 Kagara Mine
Federal member for Kennedy Bob Katter called for a government inquiry into the collapse while lambasting ASIC over the fall.
"I will be calling for a full inquiry into this, whether it is a parliamentary inquiry or a Senate inquiry. I am not letting this go," he said.
The bulk of creditors in the Kagara collapse are from Mr Katter's electorate and he said yesterday the real effects of the collapse were now just starting to be felt. The ramifications will be terrible. A lot of these businesses that have been burned are small family businesses," Mr Katter said.
"There will be suicides and bankruptcies of family businesses."
Meanwhile the newly appointed liquidator of Kagara moved quickly to sell off Kagara's Chillagoe mines and mill to the related company associated with Kagara director Joe Treacy.
Brisbane based Mungana Goldmines, chaired by Mr Treacy, has bought the assets by agreeing to issue $15million in convertible notes, which need not be honoured for five years.
Mungana is 60.7 percent owned by Kagara, of which FTI Consulting is the Liquidator. FTI was previously the administrator of the Kagara assets but was only able to sell part of Kagara's assets centred on the Mt Garnet mill.
The Mungana deal is likely to generate huge controversy in North Queensland where Kagara owes employees $17.2 million and creditors an estimated $70 million to $100 million.
In an announcement yesterday, the lead liquidator Michael Ryan of FTI said the binding Heads of Agreement entered into with Mungana provided the companies and their stakeholders with the greatest upside and flexibility, while at the same time having downside protection via the security to be provided by the group.Author: James McCullough Source: Courier Mail
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