Wednesday, 29 April 2015

FT closer to closure

The ministerial statement on the future of Forestry Tasmania today was an announcement of the appointment of a de facto Administrator.

Expressions of interest are to be invited for some of FT’s assets, mainly the hardwood plantations, which hopefully will be enough to cover the costs of Administration.

FT will then almost certainly be wound up.

It was always going to be this way. The talk about transitioning to other, in this case, private operators, is simply a restatement of what happens when companies are wound up.

Minister Harriss is pretending that selling assets in Administration will save FT from Liquidation.

How often do Administrators forestall liquidation and manage to return a company to normal trading without equity injection or a significant compromise with its creditors?

None spring to mind.