The Federal Court has made orders to wind up a failed land banking company after its creditors’ resolution for it to enter into a deed of company arrangement (DOCA) was rejected.
ASIC sought the wind-up orders as it considered it in the public interest for a proper investigation into the affairs of Midland Hwy to be conducted by independent liquidators, rather than it enter a DOCA proposed by Bilkurra Investments.
Nicholas Martin and Craig Crosbie of PPB Advisory have been appointed as the liquidators.
In his judgement, his Honour Justice Beach found that the public interest required the winding up of Midland Hwy, particularly where there is no intention for any part of the business of Midland to be salvaged.
“There is nothing concerning Bilkurra’s financial position or status that would give me or the option holders any confidence that the project will proceed to completion,” Justice Beach said.
“Moreover, the project appears to now be in the hands of entities and persons implicated in the very transactions under which $24 million of option-holders’ funds have been siphoned off in shadowy circumstances and through the use of phantom-like corporate structures.”
ASIC commissioner Greg Tanzer said the outcome demonstrates the regulator’s commitment “to ensuring that DOCA arrangements proposed to be entered into under the act are not used as a means to avoid proper investigation and scrutiny by independent persons”.