BNB babcock & brown limited

joint venture at risk

  1. 3,267 Posts.
    The trading halt may have some link to the info in the following article....

    "Free fees for Horton members at risk

    12:00a.m. 22nd November 2008

    | By Bill Hoffman

    Babcock and Brown has failed to meet a November 20 deadline for payment of $800,000 in annual membership fees it owes as part of its joint venture deal with Horton Park Golf Club.

    The payment was already late but the board had been assured that the extended deadline would be met.

    However Babcock and Brown was placed in a trading halt on Thursday with bankers refusing to release funds.

    The club’s board meeting on Thursday night decided that if in the event that the battered investment house is unable to meet the payment by year’s end, the 1200 members who had been promised free fees as part of the deal would be billed.

    Board members, concerned that Babcock and Brown would fail to meet its obligations, paid their own fees earlier this month to ensure they would not become unfinancial and technically unable to perform their duties.

    The news has sparked immediate calls from members for the club to walk away from the deal which had been brokered on the back of Babcock and Brown’s promise to cover their fees for the first five years.

    Club director of finance Tony Nicholson said a letter was being sent to all members explaining the situation and advising that they would be given to the end of January to become financial.

    The board is also developing an instalment payment plan to assist those members who can not afford a lump sum payment.

    Mr Nicholson said the board had assured B&B it would not unreasonably stand in their way of finding a new partner.

    “B&B cannot sell their interest without the approval of the club and of course such approval would not be given unless the club was satisfied that there was no degradation in its position,” he said

    “In a situation that B&B (or a liquidator) was unable to find a new partner for the project the club is fully protected and we believe there could be no call on our funds or property.

    “The club would have ownership of the intellectual property gained by the project including all information on the applications to council on both sites which have both been lodged in the name of the club.”

    The club would then be able to seek a new partner who would have the advantage of all the work which has been done to date.”

    That position is not good enough for member Dave Houston who believed he had the numbers to defeat the proposal but lost when the free fee offer was put to members.

    He said the board should now walk away from the deal.

    “Members voted for that proposal,’’ Mr Houston said.

    “Neither the board nor Babcock and Brown have any right to do anything other than the proposal members voted on. If anything else is to happen it needs to go back to members for a vote.

    “They (the board) should walk away. They have no permission from members to do otherwise.’’

    The board has told members that it remains confident that despite the difficult financial situation, and with the members’ support, a way could be found to keep the project and its goals on track."

    and an article the day before...
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