Letter from NAIF's Chris Collins and my response:-Chris...

Letter from NAIF's Chris Collins and my response:-

Chris Collins

Jun 13, 2024, 2:37 PM (2 days ago)

to me, Mark, [email protected], Patrick, Bruce, Greg, Peter

Dear Mr Patrick,

Thank you for your emails below and your earlier email of 11 June 2024.

NAIF’s legislative and governance frameworks are available on the NAIF website. NAIF is empowered through the Northern Australia Infrastructure Facility Investment Mandate Direction 2023 to manage its portfolio of investments. Relevant to your query, this includes a requirement to actively monitor and manage investment performance. As previously advised, NAIF’s focus is to ensure the successful completion of the project and to realise the public benefits that were forecast at the time NAIF made its investment decision.

Any proposed changes, waivers, or consents to NAIF’s contractual arrangements necessary to ensure the successful completion and operation of the project will only be made if they comply with NAIF’s legislative and governance frameworks and seeking an opinion from the Solicitor General is not required. Should any changes, waivers, or consents to NAIF’s contractual arrangements occur, Minister King’s Office (NAIF’s responsible Minister) will be updated as part of NAIF’s regular communications with the Minister's Office.

As you have identified, NAIF is not a party to NSW Supreme Court, Case 2024/00188463. NAIF understands this case relates to Court orders requiring Genex to convene and hold a meeting of Genex shareholders to consider and vote on the Scheme and approve the dispatch of explanatory materials such as a transaction booklet that you have accessed. This is a customary process and NAIF does not intend to make any application in respect of that proceeding.

FIRB is better placed to answer your queries on their processes.

Kind regards,

Chris

Chris Collins
Chief Legal Officer

Northern Australia Infrastructure Facility (NAIF)
Level 19, 12 Creek Street, Brisbane, QLD, 4000

M +61 459 809 991

E [email protected]

W www.naif.gov.au

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Mr Chris Collins

Chief Legal Officer

Northern Australia Infrastructure Facility

Dear Mr Collins

Thank you for your response to my correspondence(s).

It seems fair to say the complex situation the various parties to this matter find themselves in arose from ASIC’s Mr Peter Witham decision to turn a blind eye to my Report of Misconduct.

While Mr Witham points out the standard spiel about ASIC’s market supervision he and ASIC clearly wanted in this case to have nothing to do with the MARKET MANIPULATION orchestrated by the Genx Power Board in the months prior to the NBIO?

Instead of having an experienced and appropriately qualified investigative officer contact me, to discuss the Report of Misconduct and related issues, including the suggestion that the Takeover Panel become involved because of clear conflict of interest, the only thing ASIC seems to have done is grant a time extension.

Obviously NAIF has an obligation to actively monitor and manage its portfolio of investments; including the changes you mention. Kidston Storage Pumped Hydro, (K2H), is by far NAIF’s biggest investment. If NAIF, as you claim, regularly communicates with Minister King’s office, why is it that she and Minister Gallagher are unable and/or unwilling to respond to my communications?

I wrote this morning to Minister Gallagher’s office, (Mr Patrick Cronan), on this very issue.

GTLaw and MinterEllison came before Mr Justice Black’s Court, in the NSW Supreme Court, Sydney, to obtain approval of the Transaction Booklet. In doing that GTLaw and MinterEllison seemingly failed to address the TWO glaring deficiencies in your letter.

Firstly, you did not deal with the issue of the secretive “SECRET” loan to Genex Power Ltd. There have been consequences, (particularly concerning the VWAP calculations used to justify the offer), for Genex shareholders of details of that concessional loan being withheld from them but not from J - Power and its employee and Genex director Mr Kenichi Seshimo. That is a matter ASIC has chosen to ignore and one NAIF has not clarified with the Commonwealth Solicitor-General, Dr Stephen Donahue KC. What cannot be ignored is the prospect of the overseas corporation, J - Power, becoming the beneficiary of that $610 million taxpayer funded loan. I repeat, under what legislative, regulatory or ministerial authority can NAIF approve of that position?

Secondly, you did not confront the issue for NAIF of the purchase of Genex Power Ltd by a foreign entity. How can NAIF sit passively by knowing a Transaction Booklet was being negotiated between the two parties legal representative Geread Dooley, (GTLaw) and John Williamson-Noble, (MinterEllison), as they prepared to appear before Justice Black. If for no other reason NAIF should have been a party to the proceedings in Case 2024/0088463 to explain to Mr Justice Black why NAIF is not seeking the refinancing of the $610 million concessional loan. Surely that, (being a party to Case 2024/00188463), would be a requirement in terms of managing NAIF’s investment portfolio. It seems GTLaw chose not to disclose to Justice Black this as an issue to be resolved.

As you say the FIRB is best placed to answer my questions concerning the future ownership of Genex Power Ltd. I have not been able to extract anything from Mr Bruce Miller, FIRB. As far as I can ascertain NAIF has neither sought or given any information to the FIRB about NAIF’s top investment. Is that correct? It begs the question why, like NAIF, did the FIRB not seek or be asked by GTLaw and MinterEllison to be parties to the Case 2024/00188463?

The approval of the Transaction Booklet is, I believe, flawed because these two issues, the future of the “SECRET” taxpayer funded concessional loan and the ownership of Genex Ltd by a foreign entity have not been resolved.

Frankly the scurrilous activities of the Genex Power Board, mainly involving failures to disclose crucial financial information about the “SECRET” NAIF loan and the project it was provided for, (K2H), warrants the takeover being withdrawn.

If J - Power wishes to proceed with trying to acquire Genex it should begin again. Before then Genex Power Ltd and J - Power should, ONE, clarify the issue of the future ownership of the NAIF concessional loan with NAIF and, TWO, obtain approval, (confidential), for the proposed foreign ownership from the FIRB, before making an offer.

On the question of fair and reasonable value of Genex shares, J - Power should be prepared, given the clear conflicts of interest pointed out yet ignored by ASIC, seek the involvement of the Takeovers Panel.

For reasons probably best known to Messrs Kidston, Craven and Seshimo the takeover and the two company’s legal advisers the existing Transaction Booklet has been issued without the above two crucial being resolved.

Is it time for Genex Power Ltd and Electric Power Development Co,. Ltd, in fairness to Genex Power Ltd shareholders, to go back to the drawing board?

It will indeed be interesting to read Dr Ralph Craven’s response to the letter I sent him yesterday.

Yours sincerely

Howard Patrick

Yesterday, out of the frustration of continuously being ignored by Minister Gallagher I contacted her Parliamentary Office. I sent the following email to Minister Gallagher's Deputy Chief of Staff, Patrick Cronan and the Department of Finance officer who it seems would prepare briefs for the minister on matters pertaining to the Northern Australia Infrastructure Facility Act 2016.

It is all so easy for Mr Collins to write, "Should any changes, waivers, or consents to NAIF’s contractual arrangements occur, Minister King’s Office (NAIF’s responsible Minister) will be updated as part of NAIF’s regular communications with the Minister's Office.", That does not match with Ministers King and Gallagher refusing to provide me with any responses.

This whole matter reminds me so much of the proposed illegal takeover proposed by Skip Capital, with the overt support of Simon Kidston, in 2022. Like back then, NAIF apparently did not obtain an opinion from the Solicitor- General. If NAIF did get an opinion it has persistently refused to provide a copy of the opinion. Bureaucratic incompetence and/or corrupt practices?