If ILP is owed more than the 9 million then the proverbial will hit the fan.
How can your man sage not know what is owed to ILP.
''Even if the litigation funder is owed $6 million, $7 million or whatever'' said sage.
Nick Evans Wednesday, 11 August 2010
CHAMELEON Minings former litigation funder has thrown a minor spanner into the works of the companys recapitalisation deal with Tony Sage?s Cape Lambert Resources, with a Singapore-based litigation funder apparently trying to appoint a receiver over the companys head.
Chameleon entered a trading halt this morning after the Australian Securities Exchange queried the status of the company.
Chameleon confirmed it was aware that International Litigation Partners has apparently appointed a receiver over the company, though managing director Anthony Karam told the ASX that Chameleon has had no direct contact with ILP over the matter.
ILP had been backing the legal costs of Chameleon?s claims against Murchison Metals, and at one point held a $20 million fixed and floating charge over Chameleon?s assets, as part of the legal funding deal, according to media reports last year.
MiningNews.net understands ILP was sacked by Chameleon this week, after Cape Lambert agreed to extend the company a $6.5 million credit facility and take part in a $2.5 million equity raising.
The move to sack ILP comes only weeks before an expected decision in the Murchison case, which could see the company wind up with Murchison?s share in Crosslands, the vehicle that holds Murchison?s Mid West iron ore tenements via a joint venture with Japanese company Mitsubishi.
While the news was enough to send Chameleon into a trading halt today, Karam said in his response to the ASX this morning that he expected the move to appoint a receiver over Chameleon would be immediately dismissed in a court hearing.
Speaking to MNN this morning, Sage also dismissed the move, saying it would not have any impact on Cape Lambert?s decision to invest in Chameleon.
I dont think [ILP] can appoint a receiver [Chameleon] has $9 million in the bank,? he said.
Even if the litigation funder is owed $6 million, $7 million or whatever, theres still money to cover it ? there was a million in the bank, and we put in a combination of $9 million, so I can?t see how it was ever thought the company was in receivership territory,? he said.
It seems to me to be an act of someone who is pretty upset and it will quickly pass, I think.
I cant see how any judge would say the company needs to be put in receivership when you?ve got plenty of money in the bank to pay off all of your debts.?
MiningNews.net tried to seek comment from Chameleon for this story, but had not been able to contact the company before our deadline.
CFE Price at posting:
36.5¢ Sentiment: None Disclosure: Not Held
(20min delay)