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Highlights
- Panoramic shares will be transferred to Zeta Resources (ZER) under a Supreme Court-approved agreement.
- Independent report confirms Panoramic shares hold no residual value due to liabilities exceeding assets.
- Administrators seek ASIC relief to finalize the transfer and implement the restructuring plan.
The Supreme Court of Western Australia has approved the transfer of Panoramic Resources’ shares to Zeta Resources (ASX:ZER) under a deed of company arrangement (DOCA). This decision marks a significant step in the restructuring process of Panoramic Resources, which has faced financial challenges amidst a declining nickel market.
The court decision follows an application by Panoramic’s administrators on 25 October, requesting approval for the transfer. Justice Jenni Hill ruled in favor of the transfer, which was unopposed. The court was satisfied with an independent expert report that concluded Panoramic shares held no residual value as the company's liabilities exceeded its assets by approximately $27.16 million.
As per the ruling, all shares in Panoramic will be transferred to Zeta Resources for nil consideration. The decision was based on findings that the shares had no prospect of regaining value within a reasonable timeframe and that the transfer would not unfairly impact Panoramic shareholders.
With this condition precedent of the DOCA now satisfied, the administrators will seek relief from the Australian Securities & Investments Commission (ASIC) to finalize the restructuring plan. ASIC has provided an in-principle agreement for relief, contingent on section 444GA orders, which have now been cleared following the court's decision.
Administrators expressed confidence that the transfer to Zeta Resources represents the optimal resolution for creditors, considering the challenges in the nickel market. FTI Consulting’s Senior Managing Director, Daniel Woodhouse, highlighted the transparency of the sales process and the binding proposal from Zeta Resources as key factors in achieving a favorable outcome.
The challenges for Panoramic Resources began earlier in the year when a downturn in nickel prices forced the company to halt mining operations at its Savannah mine in Western Australia. This closure resulted in the loss of approximately 350 jobs.
The administrators emphasized that the sale to Zeta offers a better outcome for creditors compared to liquidation. They acknowledged the difficulties of securing a buyer for a nickel-focused company in the current market but maintained that the agreement with Zeta aligns with the best interests of stakeholders.
This decision signifies progress in restructuring Panoramic Resources and provides clarity on the company’s future under the ownership of Zeta Resources (ZER).
