Opes Fire Sale Poised To Start

The Age

Monday April 7, 2008

Vanessa Burrow, Markets Reporter

A MASSIVE asset sale program will begin this week as the receivers to collapsed broker Opes Prime Group try to at least partially repay its clients.

The sale program on assets of up to $440 million will begin as up to 1200 clients, classed as unsecured creditors, meet administrators at Ferrier Hodgson for the first time. Six creditors meetings will be held in Melbourne tomorrow for Opes Prime Group and related entities.

Ferrier Hodgson principal John Lindholm said creditors would be given preliminary estimates of any dividends.

The administrators plan to put the group in liquidation as soon as possible and are likely to convene meetings for the liquidation in the week starting on April 21.

This week's creditors meetings come as more clients present legal challenges that try to stop Opes Prime's secured creditors, which include ANZ, Merrill Lynch and Dresdner Kleinwort, from selling shares.

One Opes Prime client, who was owed about $250,000, said Slater & Gordon would represent several clients at the meetings.

ANZ is part the way through a share sale program by Goldman Sachs JBWere, as it tries to recover about $650 million. But Merrill Lynch, which was owed more than $400 million, has almost completed its share liquidation.

Deloitte partner Chris Campbell, one of two receivers and managers appointed to Opes Prime, said a separate asset sale program would begin this week.

The receivers estimate that clients are owed between $580 million and $600 million once margin-lending arrangements or debts are taken into account. They have identified assets worth up to $440 million, in addition to more than $1 billion in shares that secured creditors held as security.

"There's two major asset categories making a real difference for the unsecured creditors," Mr Campbell said.

"The first one is the $200 million to $300 million that's in irregular accounts; the second one is about $135 million to $140 million worth of assets that are in related companies. There's a whole myriad of assets that are sitting there - anything from cars to interest in properties or loans against properties to lending to other public companies."

He said there was a "reasonable amount of forensic accounting" to be done, working out exactly what was in the irregular accounts. The receivers would "go after" certain parties, which may or may not have enough money to repay the assets. Tangible assets, such as motor vehicles, would be sold in a liquidation program to begin this week.

Mr Campbell said the secured lenders might recover surplus funds that could be used to pay unsecured creditors.

"I've always thought there would be something for the unsecured creditors, but I just don't know how much," he said.

At least 23 listed companies have been forced into a trading halt because of the Opes Prime collapse.

On Friday, biotechnology company BioProspect failed to obtain orders from the Takeovers Panel restraining ANZ from selling BioProspect shares that were transferred from Opes Prime Group or related entities.

But ANZ agreed not to sell the BioProspect shares, which represent more than 5% of the company, before making a proper disclosure to the market about its interest in it.

ANZ agreed not to sell the stake over any three consecutive trading days.

OPES PRIME GROUP

FIRST CREDITORS' MEETINGS*

TOMORROW

Venue Melbourne Convention and Exhibition Centre, 2 Clarendon Street, Southbank.

9.30am Leveraged Capital

10.30am Hawkswood Investments

11.30am Trader Dealer

12.30pm Opes Prime Global Securities

1.30pm Opes Prime Group

2.30pm Opes Prime Stockbroking

*Notice given by administrator John Lindholm, Ferrier Hodgson

© 2008 The Age

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