follow up in he age

http://www.theage.com.au/business/read-the-signs-to-learn-the-big-secret-20100610-y0j4.html

Read the signs to learn the big secret SCOTT ROCHFORT
June 11, 2010


It'll be a short stroll from work ... ASX chief executive Robert Elstone. Illustration: John Shakespeare
The Australian Securities Exchange has remained tight-lipped on the location of its $32 million data centre due to open next year.

''Unfortunately the location needs to remain confidential,'' reasoned ASX spokesman Matthew Gibbs.

The ASX, however, provided one clue yesterday by saying the centre would ''be located outside of, but a short distance from, the central business district of Sydney''.

This leaves Oxford Street, Kings Cross, Star City casino, a bunker underneath the Domain, Russell Crowe's waterside apartment in Woolloomooloo or the Barangaroo precinct as potential locations.

One possible clue could be a building suddenly having the letters ASX put on it. Or if ASX chief executive Robert Elstone is spotted loitering near any specific inner-city laneways.

Less obvious clues could be large numbers of car number plates with the letters ASX being spotted in one street; tickerboards being erected at nearby bus shelters; the naming of the first inner-Sydney street to join the roll-out of the national broadband network; excessive numbers of speeding tickets suddenly being given to drivers in a particular spot; and nearby nightclubs or adultshops adopting names like Bourse, ASeX or the Exchange.

HERE'S THE PLAN

Former Fortescue Metals chairman Gordon Toll does not appear to have convinced all Compass Resources shareholders of the merits of a proposal to hand him and a US hedge fund a 95 per cent stake in the company that was once worth $770 million.

Next Tuesday's vote on the proposed deed of company arrangement will dilute the current sharebase 20 times, all in an effort to extinguish a $73 million debt. The debt was the result of cost blowouts associated with building a $250 million copper-cobalt-nickel mine and processing plant (it was originally meant to cost $70 million).

It remains unclear if the Compass chairman and the US-based YA (Yorkshire Advisers) Global will front shareholders to answer some lingering questions at the meeting being hosted by the administrators, Ferrier Hodgson.

Global held convertible notes in Compass, while Toll as chairman provided a loan just months before the company was placed into voluntary administration in early 2009.

One question put by a group of disgruntled shareholders related to Toll being appointment in September 2006 to a Cayman Islands hedge fund which in the past described itself as "a global opportunistic natural resources fund seeking multiple returns by focusing on deeply discounted private, pre-IPO natural resource companies".

WAY BACK WHEN

Toll was a lot more upbeat about Compass Resources when he sold $5.9 million worth of shares (worth up to $4.23 each) in October 2006 to help fund the purchase of a property by his private investment company. At the time Toll explained: ''The value of the extraordinary assets of our company have not been diminished by my personal need to raise cash.''

He added: ''I am convinced that the investors who bought my shares will not be disappointed.

At the time Compass had $75 million in the bank. This was before it was forced to borrow money to cover the massively increasing cost of building the Browns Oxide Plant, south of Darwin.

A lot can change over the space of a year or two.

Toll did not appear so excited about building a portfolio of Compass shares in early 2009. At a meeting in January of that year, Compass shareholders were to vote on a resolution to grant Toll's private company 90.5 million shares priced at 42 each to extinguish the $US25 million he was owed by Compass. They were also asked to vote on the resolution to grant YA Global a 35 per cent stake in return for cancelling its debt.

But when shareholders turned up to the meeting they were informed Compass had been put into voluntary administration that day.

Under the deed of company arrangement now being proposed to shareholders, Toll will be granted 422,101,919 shares or a 15 per cent stake priced at 2.5 each. YA Global will get an 80 per cent stake.