Thursday 21 September 2006 – LAWFUEL – Law News Network – The Federal Court of Australia in Brisbane has ordered ASX-listed company Green Pacific Energy Limited (GPE), and its subsidiary Green Pacific Energy Capital Pty Ltd, to be wound up following an application made by the Australian Securities and Investments Commission (ASIC).
ASIC sought to wind up Sydney-based GPE on the grounds of insolvency, and on just and equitable grounds following allegations that GPE’s Chairman and Chief Executive Officer, Mr Alfred Chi Wai Wong, had acted in his own interest rather than in the interests of GPE’s members as a whole. The allegations were focused on two main events: �� the use of $4.8 million, out of $6.3 million invested in GPE by JF Capital Partners Ltd, a specialist wholesale Australian equities manager, for the repayment of debts owed to companies related to Mr Wong.
This was done without the knowledge or approval of the GPE Board of Directors and contrary to the direct representations that were made to investors, and the representations made to the public via announcements to the ASX, that the funds would be ‘applied to the roll out of GPE’s pipeline of renewable energy projects’; and �� the promotion of promissory notes in GPE at public seminars and the issue of these promissory notes to members of the public, under the direction of Mr Wong, to raise capital for the company, when the Board of Directors had clearly resolved not to issue any promissory notes to the public until GPE had a firm business strategy in place. ‘ASIC will not hesitate to take action where it has concerns that a company is being run contrary to the interests of members and creditors and where it continues to trade and incur debts while insolvent’, ASIC’s Executive Director of Enforcement, Jan Redfern said.
The Honourable Justice Greenwood was satisfied that the conduct of Mr Wong was improper and misleading. He stated in his judgment that, ‘Public interest in the governance of corporations and particularly corporations listed on the Australian Stock Exchange demands engagement by the Board in material questions which affect or are likely to affect the affairs of the company and the interests of the members and creditors’.
Mr Gregory Winfield Hall, of PricewaterhouseCoopers in Sydney, has been appointed as the liquidator of GPE and its subsidiary. Background ASIC commenced a surveillance review of GPE and its related entities after receiving a notice from GPE’s external auditor which raised concerns about the solvency of the company and corporate governance issues. For further information contact: Danielle Huck ASIC Media Unit Telephone: 03 9280 3407 Mobile: 0417 540 769