Newspaper Commentary

Found this article by Peter Milne (West Australian Newspaper 2 Feb. 2019).

Creditors back Eastern Goldfields’ $22m rescue plan.

Failed miner Eastern Goldfields will be looking to raise at least $22 million and return to share trading after creditors approved a rescue plan yesterday.

The Michael Fotios-backed company, which owns the Davyhurst and Mt Ida gold projects north-west of Kalgoorlie, fell into administration in November, days after a $75 million recapitalisation plan was withdrawn.

Creditors at the Perth meeting chaired by administrator Martin Jones of Ferrier Hodgson voted to accept the deed of company arrangement for all Eastern Goldfields entities.The motion for the parent company Eastern Goldfields Limited was approved by 40 creditors owed $55 million and opposed by eight owed $15 million.

The DOCA proponent, US investor Hawke’s Point, plans to recapitalise Eastern Goldfields and relist it on the Australian Securities Exchange.

Forty per cent of debts to unsecured creditors will be converted to equity, with 22¢ in the dollar paid on the remaining 60 per cent.

A $7.3 million trust will be set up to pay creditors.

A report by administrators said the miner could have fallen into insolvency as early as August 2017, when operations began at the Davyhurst mine.