Deadline hit for Whyalla steelworks bids
Indicative bids for the Whyalla steelworks are due today, with administrators KordaMentha looking to invite a “select number of parties” to continue on to phase two of the process once the bids are assessed.
KordaMentha released an update into its administration of OneSteel Manufacturing on Thursday, saying they had continued to operate the steelworks and associated iron ore mines and had not made anyone redundant during the process, which started on February 19.
The federal and state governments kicked in an initial $100 million for support programs for local businesses, with a follow-up $275 million pledged in July to keep the steelworks operational during the administration process.
In a letter to creditors released on Thursday, KordaMentha said the duration of the sale process was uncertain at this point.
“The timing and structure of Phase 2 is currently unknown and will be highly dependent on the nature of the indicative interest received and the extent of engagement required with the governments regarding funding/support to be offered as part of the process,’’ the letter says.
“With respect to employees, the administrators have made no redundancies during the administration and have maintained open and frequent lines of communication with employees.
“The administrators are also in the process of working collaboratively with unions and employees to renegotiate the company’s two expired enterprise agreements.’’
A court case between Whyalla Ports Pty Ltd – an entity owned by Sanjeev Gupta’s GFG Alliance – and the administrators will also return to court on August 7.
The dispute was initially about whether Whyalla Ports had a valid lease in place to occupy the land, however the SA government subsequently passed legislation clarifying that any such lease was null and void, KordaMentha said.
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A number of cross claims relating to the ownership of certain assets at the port remain on foot and will be tested by the court.
Whyalla Ports itself was placed in administration and receivership in early June.
“As Whyalla Ports has no employees and the company manages day to day operations at the Whyalla Port, there have been no discernible negative operational impacts as a result of these matters to date,’’ Kordamentha’s letter says.
BlueScope, which has been helping Kordamentha run the steelworks, is widely tipped to be one of the bidders for the operations.
