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There was administrators (KPMG) update heads-up issued on 29th Nov with meeting later on 2nd-Dec, it's all there in link by Ecclescake. In short: still no hopes for shareholders (as DOCA sections point out) as unsecured creditors are way to far from recovering much from all this mess and sadly for everyone - it's at low end of single-digit percentages.
I have emailed the administrators regarding any news for us poor UK shareholders.
Take a look at https://home.kpmg/au/en/home/creditors/salt-lake-potash.html
Let me know what you make of the 3rd October letter, Deed of Company Arrangement. I'm not clear what arrangements have been entered into, doesn't look like a sale.
I have just heard that the company has been sold.
Does any one know anything about this and whether our UK shares might have some value?
Archeologists? or necromancer? What's the point of upping old news?
Lombard Odier Asset Management (Europe) Ltd owned 8.77%
Ellerston Capital Limited 5.58%
Fidelity International 4.05%
Wed, 20th Oct 2021 10:55
(Alliance News) - Sequoia Economic Infrastructure Income Fund Ltd on Wednesday noted investee Salt Lake Potash Ltd has announced a voluntary administration after an unsuccessful equity raise.
AIM listing Salt Lake was looking to raise cash to further its Lake Way potash project in Australia.
"The proposed equity raise has been unsuccessful and Salt Lake Potash have announced a voluntary administration of the company as at 20 October 2021," FTSE 250-listed Sequoia Economic said.
Sequoia's investment in Salt Lake represented 1.9% of its net asset value on September 30.
Sequoia added: "The investment adviser had been developing a contingency plan should the funding gap not be addressed. This contingency plan has now been activated in full alignment with the lender group. The lender group has appointed KordaMentha, a leading Australian restructuring and advisory firm, as receivers for the lender group."
Martin Jones, Tom Birch and Hayden White of KPMG have been named as voluntary administrators.
Under Australian laws, the receivers KordaMentha act for the benefit of a company's lenders. They may undertake trade sales, debt recovery or other restructuring work.
Salt Lake's receivers said they will "commence a process to market the company and its assets for sale and recapitalisation opportunities in the coming weeks".
Sequoia noted that the total amounted invested in the Lake Way project "materially exceeds" the debt. However, the investor noted a similar potash project with similar ramp-up issues to Lake Way recently achieved full production.
The voluntary administrators, meanwhile, on Wednesday said Salt Lake's director resolved that the company was insolvent or likely to become insolvent "at some future time".
Sequoia added: "Whilst it is too early and speculative to comment on the eventual recovery percentage of our investment, our senior secured position should position us strongly in the restructuring process."
Sequoia shares were 0.2% lower at 108.97 pence each in London on Wednesday morning. Salt Lake shares were suspended on Tuesday, they were last quoted at 2.25 pence.
Salt Lake on Tuesday said it was working towards finalising a fundraising plan "that would be necessary to continue operations".
Salt Lake Potash auction almost ready to roll
Sale adviser Macquarie Capital was understood to be putting the finishing touches on the sales material - information memorandum and the like - this week, after sending a teaser last month.
In the time since, potash prices have been strong while on March 10, the company doubled the measured mineral resource at its flagship Lake Way project in Western Australia to 1.87 Mt.
The question is, who would be interested in taking it over. Macquarie’s previously pitched it as a “clean control acquisition” instead of a sale-for-parts.
While the commodity would appeal to a large pool of companies (miners, agricultural and chemical businesses), potential bidders are likely to think hard about how tough the extraction would be, given that has been Salt Lake Potash’s problem all along. And whether the 1.87 Mt would be big enough for a punt.
Salt Lake Potash had a $250 million odd market cap and $170 million in debt when it went under. It has been in receivership under KordaMentha for five months.Macquarie was hired in February to run a sale.
It's ironic that SOP prices have gone through the roof after the Russian invasion of Ukraine and are now +US$1000/tn. SO4 would be printing money like crazy right now....if only the plant had worked. So close, but no cigar.
Commencement of sales process - Korda Mentha
10 October 2022
Https://hotcopper.com.au/threads/ann-sale-process-commencement-and-resource-upgrade.6634955/
Sale process underway for Salt Lake’s stalled project
10 March 2022
Https://newswires.com.au/companies/ASX:SO4
Receivers for failed Salt Lake Potash are set to test market appetite for the company’s stalled Lake Way sulphate of potash project near Wiluna after pressing the button on a formal sales process.
Salt Lake Potash receiver hunts for buyer; MacCap mandated [Macquarie Capital].
23 February 2022
Https://www.afr.com/street-talk/salt-lake-potash-receiver-hunts-for-buyer-maccap-mandated-20220223-p59yzb
Four months after KordaMentha took the keys at Salt Lake Potash, it has finally kicked off a buyer search with Macquarie Capital’s bankers in tow.
Had a message from HL today, salt lake potash limited has been delisted and shares removed from account, the company will now be known as SO4 Limited
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dates below:
Index Effective From
Start of Trading
FTSE AIM All-Share Index 24 November 2021
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I made the mistake of investing the day before this went into administration. I understand it's not over until the fat lady sings but what are the chances this will make a comeback?
Firstly - they're are not producing it in order to benefit from product market prices.
Secondly - for entities having troubles with solvency shareholders are not considered anymore, key priority shifts to creditors and they're updating this group about situation via different channel (on stock market it suspended anyways).
Therefore it would be very naive to expect full transparency and updates for shareholders.
Over the last 18 months, and this BoD completely shambolic!
Of retaining any kind of value from the sp would be the use of the AIM listing as a cash shell. With the hefty losses it might make this option appealing. An exceptionally slim chance but you never know
Tradehobbs, there was no production. That was the problem, they need A$100m to fix the ponds and the plant, and no one was willing to front up with that sort of cash when there are other potash projects to invest in.
In short, the best option now is the receivers sell the plant to one of the other potash hopefuls, but even they are struggling to raise cash due to this mess. Australian Potash (ASX:APC) is perhaps the most logical buyer geographically, but they've been struggling for 12 months to raise the funds for their own project, and would have to weight buying a plant that doesn't work vs building their own and hoping it does work.
At the end of the day, the plant will probably get sold for cents in the dollar, lenders will have to take a haircut and shareholders will get nothing (unless they are successful with a class action against the Directors).
Does anyone know the chances or if it is even possible if they find a buyer say willing to purchase 50% of SO4 to pay of the urgent repayment debt allowing SO4 to proceed and continue with production whilst still owning a big slice of the pie?
Just curious to hear people’s thoughts on the possible outcomes here.
Spoke with 212 trading team and its still processing orders might have a turn around and find funds by a miracle
Imo, this letter is just for formal compliance purposes, technicality for marking checkbox on their side (especially considering timing of making it public) . It would be hard to expect for anything tangible to come out of it.
It might add additional transparency basis for a possible action against BoD but having it without this letter won't affect the outcome.
Thank you WelshFalcon for ASX letter details. Interesting reading the document. I need time to reflect on the contents because they do imply investors have been wilfully misled ...
For sure both SXX and S04 turned out to be duds. Nevertheless you there is a vast difference between Polyhalite and Sulphate of Potash - the latter being a high value quality product. There is however no shortage of the "standard" 60% Muriate of potash globally. :-(
I'm never investing in potash ever again. Didn't loose much here compared to SXX, but still hurts.
If you have a read through Hot Copper's board on SO4, you will find a long thread on a class action some are trying to put together in Aus. Interesting read.
Sign up and add you name if you wish. For me, these things rarely come to fruition, and can be just throwing good cash after bad. I haven't made a big enough loss to make it worthwhile. Some may find a bit of comfort there and like minded souls in another hemisphere!
Thanks WelshFalcoln, a very interesting read and I have appreciated your informed posts. I should have heeded the warnings like you did, there were enough alarm bells ringing and I didn’t act on them. My fault.
However, I do think that SO4 have been at best disingenuous and at worst borderline fraudulent. The ASX letter is pretty damning.
Just a few of the questions they asked-
“1. Does SO4 consider its commencement of First SOP Production in June 2021 to be information that a reasonable person would expect to have a material effect on the price or value of its securities?
2. If the answer to question 1 is “no”, please advise the basis for that view.
3. Did SO4 commence First SOP Production in June 2021 as flagged in the Institutional Placement Announcement?
4. If the answer to question 3 is “no”, please explain the factors which delayed SO4’s achievement of First SOP Production in June 2021.
5. When did SO4 first become aware that it would not commence First SOP Production in June 2021 as scheduled? Please provide details of the time and date.
6. If SO4 first became aware that it would not commence First SOP Production as originally scheduled and advised to the market before the time it requested the Pause in Trade, did SO4 make any announcement prior to the relevant date which disclosed that information?”
And so the letter goes on……