An issue over shares transfer has caused a delay in the $56 million sale of Yeeda Pastoral Company, a deal that would save the Kimberley business from being wound up.
An issue over shares transfer has caused a delay in the $56 million sale of Yeeda Pastoral Company, a deal that would save the Kimberley business from being wound up.
Alberta Investment Management Corporation last year submitted its bid to buy Yeeda and its assets, after the group was placed into voluntary administration in March 2024 and estimated to be $103 million in debt.
The offer comprises $8 million for Kimberley Meat Company abattoir, $23.25 million for the Yeeda and Mt Jowlaenga stations, $7.25 million for eight homes, and up to $19 million for the company’s livestock.
KordaMentha administrators recommended that the sale proceed with creditors voting in favour of Alberta IMC's offer.
However, recent court documents and correspondence to creditors show there had been a delay with the issue being escalated to the Supreme Court of Western Australia.
In a letter to creditors sent on December 24, the administrators said TLP4, an entity controlled by Alberta IMC for the Yeeda sale, obtained ministerial approval to transfer control of Yeeda and Mt Jowlaenga pastoral leases.
But a key condition for all Yeeda shares to be transferred to TLP4 has yet to occur.
“The shareholders have not provided their written consents to the transfer under [the Corporations Act] and we have therefore commenced proceedings seeking the Court’s approval to transfer the shares under section 444GA(1)(b) [of the Act],” the notice to creditors reads.
“The deed administrators had initially targeted 20 December 2024 for the effectuation of the deeds of company arrangements (DOCA).
“This was on the basis that written consents to the transfer of shares in accordance with s.444GA of the Act would be received.
“The requirement to file an application with the court for the court’s approval to transfer Yeeda’s shares has resulted in a delay to completing the proposed transaction and the effectuation of the DOCAs.”
In her judgment delivered late last week, Supreme Court of WA Justice Jenni Hill ordered the administrators to reopen their case and add evidence.
Yeeda is backed by New York-based Fitzroy River Limited and Hong Kong’s ADM Capital, which owns about 80 per cent of the business.
Fitzroy River Limited, holding a 20 per cent interest in Yeeda, claimed there were corporate governance issues that should be investigated, the court judgment revealed.
"In any event, Fitzroy says that the court should not exercise its discretion to grant the leave sought due to various corporate governance issues that they say should be investigated in any liquidation of Yeeda," the judgment reads.
"Fitzroy does not accept that the plaintiffs have established that there is no residual value in its shares to the requisite standard, and says that leave should not be granted for this reason."
Justice Hill said, in her judgment, that she was not satisfied that there was enough admissible evidence for her to consider the value of the pastoral leases, which were significant assets for Yeeda.
"First, subject to the issues raised in relation to the valuation of the Yeeda pastoral leases, there is a shortfall of in excess of $60 million," her judgment reads.
"Put another way, in so far as these claims are concerned, more than $60 million would need to be recovered from all or any of these claims in order for there to be residual value in the equity of Yeeda.
"There is no evidence before the court that would enable me to conclude that this outcome is likely or possible."
In the first creditors' report circulated in April 2024, KordaMentha administrators found the Yeeda group owed about $50.4 million to secured creditors and $53 million to unsecured creditors.
