Australia’s NewSat has entered administration after attempts to resume funding for its Jabiru-1 satellite broke down.
The group has been granted a temporary restraining order and a preliminary injunction under Chapter 15 bankruptcy protection in the…
Australia’s NewSat has entered administration after attempts to resume funding for its Jabiru-1 satellite broke down.
The group has been granted a temporary restraining order and a preliminary injunction under Chapter 15 bankruptcy protection in the US, where Lockheed Martin is building the spacecraft.
PPB Advisory has been appointed as administrator.
Hopes of restarting Jabiru-1’s funding took a blow last week when it revealed that COFACE, the French export agency partly backing the project, was not in favour of a proposed waiver deal.
NewSat has been seeking a waiver since defaulting on the debt in June 2014, after allegedly breaching terms when it borrowed a US$10m unsecured short term loan from shareholder Ever Tycoon.
The operator said on 8 April that there was about US$62m remaining to be drawn through the COFACE-guaranteed lender group, comprising Credit Suisse, Standard Chartered Bank and Societe Generale.
Other lenders withholding combined facilities worth about US$160m – predominantly the US Export Import Bank – have said they will not proceed before the issue with COFACE is cleared, or a suitable funding substitute emerges.
The waiver NewSat was drawing up would have seen it raise at least US$30m in a rights issue, and then be required to raise an extra US$50m-70m during Q3 2015.
It recently hired Peter J Solomon Company to help raise these amounts and possibly more.
Jason Preston of advisory firm McGrathNicol, who as been appointed as a joint receiver to guide NewSat through its bankruptcy, said: “The receivers’ immediate priority is to take control of the assets of NewSat, urgently assess its financial position and progress the capital raising activities recently commenced by the company.”
The Australian operator also said on 8 April that its capital raising process “may take several weeks”, putting it at risk of losing its launch provider Arianespace, which has issued a termination notice that gives it the right to terminate their agreement after 3 May 2015. NewSat added at the time that, although Lockheed Martin has also issued a termination notice, its construction was still taking place and on track to be ready for a launch in H1 2016.
Yesterday, NewSat corporate counsel William Abbott resigned as the group’s company secretary after less than three weeks in the role.
Abbot took on the additional responsibility after the departure of Linda Dillon, who was brought in as CFO and company secretary just six months before.
NewSat SVP John McDonough, who has held senior roles at NAB and ANZ and joined the group this month along with its interim CFO Mark Spragg, has been appointed company secretary.
Abbott is continuing his role as corporate counsel.
