The plot thickens....
Popcorn stock for sure.
This looks to me like it could be a masterstroke from Sage cutting ILP out of any settlement by providing the funds to CHM to pay them off. ILP sure are upset at Sage's move, now why would they be so upset,potential tens of millions of dollars settlement perhaps?
Chameleon in shock receivership stoush
Nick Evans
Wednesday, 11 August 2010
CHAMELEON Mining?s former litigation funder has thrown a minor spanner into the works of the company?s recapitalisation deal with Tony Sage?s Cape Lambert Resources, with a Singapore-based litigation funder apparently trying to appoint a receiver over the company?s 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 don?t 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, there?s 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 can?t 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.
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