$350 Million Loss Shared By 1200 Opes Clients
The Age
Wednesday April 9, 2008
OPES Prime Group would have "tipped over on the spot", had it not been for the last-minute intervention of ANZ, which added $95 million to the broker's loans late last month.
Up to 1200 clients were caught when "irregular" transactions prompted the collapse of Opes Prime. Their accounts were frozen, and despite continued legal action, many have been unable to prevent ANZ and the other secured lenders from seizing and selling their shares. But speaking after several meetings of creditors yesterday, administrator John Lindholm said his appointment, and the demise of Opes Prime, was prompted by the discovery that the holes in the company's books were much bigger than anticipated. The administrators at Ferrier Hodgson told about 80 distressed clients they would probably get about 30? in the dollar back, collectively losing about $350 million. Even that sum will probably take months to collect. But the knowledge that ANZ had stepped in to try to save Opes Prime did not reassure investors, who were critical of the way they had been treated. "ANZ has everything to lose and very little to gain because the PR they're generating out of this is fairly negative, I'd suggest," said one investor. "Let's hope (Prime Minister) Kevin Rudd has a word in (ANZ chief executive) Mike Smith's ear while they're swanning around Beijing." At what was a sombre event, the administrators lightheartedly said Melbourne underworld figure Mick Gatto, now inSingapore, was not party to their recovery operations. "The only way a debtor can discharge their obligations is to myself or the receivers," Mr Lindholm said. The administrators' efforts revolve around one of Opes Prime's clients, a company called Riqueza, registered in the British Virgin Islands. "We consider Riqueza to be a key linchpin in our investigation," Mr Lindholm said. The sole director and shareholder of the company, Singapore-based Jay Moghe, last night told BusinessDay he had delivered all documents about Riqueza to the administrators. Mr Lindholm said the administrators would pursue the six other clients who owed large amounts of money to Opes Prime through legal proceedings. Money might also be collected from Opes Prime's secured lenders, which include ANZ, Merrill Lynch and Dresdner Kleinwort. In a presentation prepared for clients, the administrators said ANZ held shares worth $919 million, Merrill Lynch held shares worth $603 million and Dresdner Kleinwort held shares worth $67 million on March 27. ANZ is owed $650 million while Merrill recently confirmed it had no additional "financial exposure to Opes Prime". Mr Lindholm said Merrill had surplus cash and shares that would eventually go to the unsecured creditors, once the ANZ-appointed receivers at Deloitte had retired. With CHRIS ZAPPONEKEY POINTS ? Opes clients told to expect about 30? in the dollar. ? Virgin Islands company believed a key in money trail. ? ANZ halfway through share sale to recover $650 million.
© 2008 The Age
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