article in Gold Coast Bulletin:Major Octaviar investor says stop...

article in Gold Coast Bulletin:

Major Octaviar investor says stop secret Stella selloff

by Shannon Willoughby

April 23rd, 2009

THE former chairman and one of the largest shareholders of Octaviar has called for greater transparency from Stella Group over the sales of its assets.

Terry O'Dwyer, who owns about 5 per cent of Octaviar's shares, said if the Gold Coast-based Stella Group was selling part of its portfolio it should be done in the public domain.

The embattled Octaviar, in the depths of administration, owns 35 per cent of the Stella Group.

Yesterday, The Bulletin revealed a secret list of Stella Group's management rights businesses that were mooted for sale.

It is understood a mystery one-line buyer is eyeing off the list.

It also is understood a few changes have been made to the list since its release, believed to be about six months ago.

Stella declined to make a statement on the record yesterday.

The group's controller, CVC Asia Pacific, which took a 65 per cent stake of the group from the then MFS (now Octaviar) early last year, has not returned Bulletin calls.

The original list, which The Bulletin sighted, featured 28 management rights holdings in Australia and New Zealand, including 10 on the Gold Coast.

Stella has confirmed the sale of two of the businesses, one in Surfers Paradise and the other in Port Douglas.

"If this was true, (the sale) the appropriate way of marketing them is for them to be offered by way of auction," said Mr O'Dwyer, who chaired Octaviar in its glory days, leaving in early 2007.

"This is the only way the best available price can be transparently seen."

He said shareholders had received no correspondence from Stella about any plans to sell.

"I'm not sure there would be a requirement on Stella and therefore Octaviar to say anything to its shareholders until the deal was done," he said.

"The reality, though, is the shareholders are entitled to expect that Octaviar guards the value of the assets and transparently demonstrates that the appropriate value was obtained in the market and the only way to do that is by public auction."

Apartment owners in the affected properties also have called for a fair go.

Wayne Stevens, who sits on the executive committee of the Unit Owners Association of Queensland, said lot holders had lost their rights.

"One of the things I want to point out is that owners have a right of approval on the transfer of management rights," said Mr Stevens.

"The real issue here is that they have never been provided with that right of approval.

"The right of approval was put into the law and the intention of that law was to provide the owners with a say and they have been denied that.

"I think this should be added into the debate."

CVC bought 65 per cent of the group from Octaviar for $1.3 billion last year.

The deal included a $409 million cash payment to Octaviar and the assumption of $906 million in Stella debt.