Oceania

Tamarind Taranaki was placed in liquidation at a watershed meeting with creditors this morning, The New Zealand Herald reported. The company, which operates the Tui oil fields ran into debts when a drilling campaign in September went over budget and was unsuccessful. Malaysian-owned Tamarind Taranaki reportedly has debts of around $350 million, including a US$100 million claim from the New Zealand Government for the decommissioning costs of closing and cleaning up the fields.

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Eric Watson's Cullen Group In Liquidation

Eric Watson's Cullen Group has been moved into liquidation by court order, meaning it might no longer fight a $112 million tax judgment against it. The company was moved into the hands of KPMG liquidator Vivian Fatupaito earlier this week, by court appointment, The New Zealand Herald reported. The Inland Revenue Department had been pursuing the company's liquidation after Justice Matthew Palmer ruled in March this year that Cullen Group was part of Watson's "web of entities" designed to avoid paying non-resident withholding tax.

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Australia’s mid-year budget update showed economic reality is starting to bear down on the government’s finances, Bloomberg News reported. Treasury lowered its forecast surplus for the 12 months through June 2020 to A$5 billion ($3.4 billion) from April’s budget estimate of A$7.1 billion as it scaled back estimated tax revenues, according to the Mid-Year Economic and Fiscal Outlook released in Canberra on Monday. It also predicted narrower surpluses for the following three fiscal years.
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A camper trailer company in the marginal seat of Gilmore was awarded a $750,000 federal government grant at a time that it may have been trading while insolvent, Guardian Australia can reveal. The grant, awarded under the regional jobs and investment program that was subject to a scathing report from the auditor general, was given to Off Road Camping Accessories, based in the NSW south coast town of Moruya, to develop a new type of composite panel to be manufactured for camper trailers, The Guardian reported.

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A subdued domestic economy and increasing risks from an uncertain global outlook have prompted Australian companies to take a cautious view of the year ahead, Bloomberg News reported. With an economy that even Australian Prime Minister Scott Morrison conceded on Monday is “soft,” new tariffs from the U.S. taking effect on around $110 billion of Chinese imports earlier this week and Brexit looming at the end of next month, not a lot of companies are optimistic about their future.

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It’s turning out to be a torrid summer for the usually sedate lead market. The London Metal Exchange (LME) lead market was roiled in early June by news of an unplanned outage at the Port Pirie lead smelter in Australia, Reuters reported. It’s just been upended again by a second shutdown of the plant, which is operated by Nyrstar, the Belgian company that had to be rescued from potential insolvency by trade house Trafigura. The second outage has seen LME time-spreads tighten again and the outright three-month price hit a two-week high of $2,101.50 per tonne on Monday.

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The High Court has delivered a landmark decision in prioritising employee entitlements in insolvency, irrespective of whether the company was trading in its own right or as a trustee, MyBusiness reported. Last week, the High Court dismissed an appeal in Carter Holt Harvey Woodproducts Australia Pty Ltd v The Commonwealth of Australia and Others [2019] HCA 20. Amerind Pty Ltd became insolvent in 2014, with $21 million in debts repaid to Bendigo and Adelaide Bank, leaving a receivership surplus of about $1.6 million.

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The High Court has declared it would be "perverse" not to give worker entitlements priority in any collapse, whether a company trades in its own right or as a trustee, the Australian Financial Review reported. The court's decision in the Carter Holt Harvey Woodproducts case means the same rules apply for the payment of creditors and is an important win for workers. This has been welcomed by leading insolvency practitioners, who say the status of workers employed by trading trusts has been so uncertain that they faced being pushed to the back of the queue with other unsecured creditors.

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The Australian dollar dropped on Wednesday after weaker than expected inflation in the first quarter, raising expectations of a possible rate cut by the central bank. In quarter-on-quarter terms, consumer inflation was unchanged in March after a 0.5 per cent rise in the December quarter, according to the Australian Bureau of Statistics. That compared to a 0.2 per cent rise forecast by economists polled by Reuters. Consumer prices rose 1.3 per cent year on year in March, against February’s reading of 1.8 per cent. The reading was also below a Reuters poll forecasting a rise of 1.5 per cent.

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Fonterra went into the black in its first half but the co-op faces an uphill battle to meet its earnings forecasts for the year while it reduces debt and streamlines its operations. The dairy giant reported net profit of $80 million in six months to January, up from a loss of $348m a year earlier, but said its net earnings before interest and tax dropped by 29 per cent to $323m, The New Zealand Herald reported. Newly-appointed chief executive Miles Hurrell said the result was "not be where it should be".

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