Fertiliser processor placed into receivership

Pictured at the launch of Featherston Resources in March 2011, chief executive at that time Emma...
Pictured at the launch of Featherston Resources in March 2011, chief executive at that time Emma Weston and chairman Tim Goodacre at the Taieri plant, with raw diatomite from Middlemarch for processing into fertiliser pellets for export to Australia. Photo by Peter McIntosh.
Almost three years after launching its multimillion-dollar fertiliser export company on the Taieri Plain, private Australian-owned company Featherston Resources has been placed in receivership.

While having spent more than $11 million by the March 2011 launch of its $1 million Envirofocus Ltd manufacturing plant on Dukes Rd at Taieri, supplied from a Middlemarch diatomite mine, Featherston subsequently reported consecutive losses in 2012 and 2013 - totalling more than $5.7 million.

Up to eight staff were expected to be working at the Taieri-based Envirofocus manufacturing plant, targeting the annual processing of 10,000 tonnes of dolomite worth more than $9 million at 2011 prices.

However, revenues during the 2012-13 financial years totalled just $307,000, of which $106,000 was product sales and $186,000 was from foreign currency gains, while operating expenses totalled $6.35 million, according to Featherston's financial report for the year ending March 2013.

In the past financial year it was recorded more than $A700,000 was committed to Featherston by directors or shareholders.

At the time, Featherston was reported to be in negotiation with two investors whose investment could improve liquidity ''between $A4 million and $A10 million'', which directors had expected to be completed by the end of 2013.

Envirofocus Ltd is a subsidiary company 100% owned by Featherston, but is also in administration and receivership. The receiver's first report is due in March.

Concerns about Featherstone's future were flagged by auditors Crowe Howarth in the company's full-year report to March 2012, which ''cast doubt'' over its viability and imminent need to secure additional capital financing, at a time when its total liabilities exceeded total assets.

On December 13, Auckland voluntary administrator Rodgers Reidy Ltd was appointed, as was Sydney-based receiver Woodgate & Co. A creditors meeting in Auckland was scheduled for next Thursday, January 23.

There has not been a receiver's first report on Featherston lodged yet. Attempts to contact administrators Rodgers Reidy Ltd and receiver Woodgate & Co, both in Australia, yesterday were unsuccessful.

Court documents obtained by the ODT show that in December and January, in the Supreme Court of New South Wales and later the High Court in Dunedin, the validity of the appointed administrators was disputed, with a separate order this week from the Dunedin court fixing a hearing in the High Court in Christchurch in early February.

One source, who did not want to be identified, said the administration and receivership were ''very complicated'' and many parties involved were not in agreement over the proceedings.

The proceedings cover Featherston Resources, Envirofocus Ltd and another Featherston subsidiary, Australian incorporated company Adveco Fertilisers Pty Ltd, the dolomite marketing company, which is also in receivership.

The source said the ''business [Envirofocus] was in abeyance'' and he hoped it could be reopened ''soon'' and that the dolomite mine in the Maniototo ''remained a major asset''.

It appears from copies of recent court documents the administration and receivership proceedings began in the Supreme Court of New South Wales in early December, on filings by a shareholder and former employee.

The private company Featherston Resources Ltd was registered in December 1997 and had five directors. The two from New Zealand were John Cook, from the Bay of Plenty, and James McLean, of Auckland. Three were from Australia. They were: Tim Goodacre, of Victoria, Christopher Watts, also of Victoria, and Emma Weston, of New South Wales.

In late 2008, Featherston had 57.1 million shares with more than 140 separate shareholders, Companies Office records showed. At the time of receivership in December it had 96.9 million ordinary shares on issue and 217 share allocations, spread across New Zealand - including several individuals around Otago - Australia and one from the Cayman Islands.

- simon.hartley@odt.co.nz

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