BHP pulls pin on NW resort bid PDF Print E-mail
THE WEST AUSTRALIAN   
Friday, 21 December 2012 09:09

BHP Billiton has rejected a $50 million offer for a collapsed Port Hedland resort project in a move that is likely to see the development liquidated.

 

Receiver Ernst & Young has told the consortium behind the offer that BHP would not agree to a condition of the deal to rent hundreds of rooms for its workers at The Landing resort.

The offer via special purpose vehicle Empire Hotels and Resorts (WA) would have seen settlements reached with the development's dozens of creditors, including BHP. The consortium had proposed to complete and run The Landing at a cost of about $82 million.

"One of the conditions was that BHP commit to 400 rooms in the tourist park of the Landing project," Ernst & Young said in a letter to the proponents rejecting the deal. "They have been considering their future accommodation requirements. At present it is not BHP's intention to undertake any such commitment."

BHP is believed to have had such an agreement with the failed developer Port Village Accommodation. The miner declined to comment.

The consortium was said to be "gobsmacked" by the rejection. The decision to effectively axe Port Hedland's biggest private infrastructure project also comes as a body blow to the community and the companies and subcontractors which had been involved in its construction.

The collapse has been financially disastrous for State Labor MP Peter Tinley's family, whose trust held half of the ordinary shares in the collapsed Centauri Property Group. Centauri had a majority stake in PVA. Mr Tinley gave up his shadow portfolios early last month when Centauri and PVA were put into receivership by BHP.

According to documents filed with the Australian Securities and Investments Commission by the receiver, PVA owed BHP Billiton Iron Ore $53 million. Unsecured creditors have also claimed the developer owes them $50.5 million, including $15.7 million to project builder the Hickory Group.

Empire had negotiated agreements with the unsecured creditors covered under the $82 million commitment. The offer had been put on the table more than five weeks ago but _WestBusiness _understands that BHP never held direct talks with the proponents.

The group is understood to have included Westralia Infrastructure - co-founded and chaired by former Federal Labor minister George Gear - two Pilbara housing developers, Oaks Hotels and Resorts and Construction Industries Australia, a subsidiary of the listed Allmines Group.

The Landing was conceived as a tourism project designed to meet accommodation shortages and be underwritten by the resources industry.

An ASIC document had showed BHP had made a prepayment of $2.6 million. Gina Rinehart's Roy Hill Infrastructure and Atlas Iron had prepaid six-figure sums.

 

 

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