Researcher below is a rough timeline relating to the PIF loan to...

Researcher below is a rough timeline relating to the PIF loan to LLA. Someone please correct me if I am wrong but it appears that Wellington Capital Limited has accepted a total of just $25million of an estimated original debt of $71million from LLA. The writedown is not included in the PIF claim against Octaviar. If WC describe the asset as being 'illiquid' why then did WC agree to grant LLA a $8 million mezzanine loan interest free for 2 years in August 2008?

LLA Timeline::
30 April 2008 – LLA states: LLA owes PIF $71 million (“total amount including interest and associated fees”)

30 May 2008 - The LLA loans mature on 30 May 2008 and could not be repaid. The LLA senior secured debt facility totalled $127 million with the NAB. LLA 30 June 2008 annual report states PIF Debt at June 2008 is $71 mill. The 31 Dec 07 and 30 June 08 PIF financial reports show $11M was advanced to LLA between 14 March 08 and 30 June 08. The June 08 PIF financial report shows $8 mill more than the LLA report, (possibly new Mezz C $8mill the PIF provided LLA as part of the recapitalisation?).

16 June 2008 - WC made an agreement with Artic Capital to a replacement and reduction of debt owed by LLA to PIF. The LLA 'Prospectus $100 million Underwritten Rights Offer' states: The PIF unsecured debt is $71 million and “PIF will grant an $8 million Series C cash advance facility to LLA.”

30 June 2008 – The 30 June 2008 PIF Financial report states LLA owes PIF $77.947M which is written down to $27M. WC state in the report (dated Sept 2008) the fund received $10 million from LLA since 30 June 2008.

30 June 2008 – LLA reports state LLA owed PIF $71 mill (this is interest and capital) at the time of the recapitalisation and then WC agreed to give another $8 mill to LLA. PIF would then get back: $10m up front and $18 million interest free for the first two years (with $10 million of this unsecured for the first year).

8 July 2008 – Melbourne Investor Forum.

“There is no amount of the LLA loan that forms part of the $147.5 million (claim) the structure of the arrangements with LLA was in place quite separately to that, most of the money advanced was secured but due to some less than perfect legal drafting part of it was as our friend mentioned unsecured and ranked behind our secure position but it was quite separate to the $147.5 million.”


06 Aug 2008 - The LLA recapitalisation completed. As part of the recapitalisation WIM as RE of the PIF is to grant LLA an $8 million mezzanine loan (interest free for 2 years, thereafter BBSY plus 7.0% margin). The PIF will receive $10 million upfront and then another $18 million over time (interest free for 2 years, thereafter BBSY plus 7.0% margin)


26 Sept 2008 – “Arctic Capital Limited acquired the entire issued capital of the RE LLA from Octaviar Financial Services Pty Ltd."

30 Sept 2008 - between July 2008 and 30 Sept 2008 WC state the PIF received $10 million from LLA and valued the LLA debt at $18 million. It is not mentioned that $8 million was advanced to LLA.

30 June 2009 - LLA debt valued at $18M down from $27 million in the PIF Annual Report. WC state they received $10 million from LLA between July 2008 and Sept 2008 (same time they were to provide an $8 million loan to LLA as part of the recapitalisation).


22 Dec 2011 - The Premium Income Fund has finalised a transaction which has seen the debt owing by Living & Leisure (Australia) Limited sold. Proceeds are $15 million. Managing Director, Jenny Hutson said:
‘I am pleased that we have been able to procure a purchaser for this illiquid asset through our corporate advisers. The debt due for repayment in 2014 having a face value of $18 million has been sold today for $15 million. The transaction represents a positive outcome for
Unitholders.’ http://www.nsxa.com.au/ftp/news/021724770.PDF