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<\/p>\nThe owner of the Bell Bay manganese smelter in northern Tasmania has entered voluntary administration.<\/p>\n
Ernst and Young has been appointed as administrator of Liberty Bell Bay (LBB), and says it will work with governments and unions to ensure the smelter’s ongoing operations.<\/p>\n
It will also meet with the company’s estimated 216-strong workforce.<\/p>\n
Ernst and Young will attempt to secure further funding for operational costs and for employee wages, with its primary role to restructure or sell the company.<\/p>\n
The existing management team remains in place.<\/p>\n
Morgan Kelly, from Ernst and Young, said they will engage closely with state and federal governments.<\/p>\n
“Our immediate focus is on stabilising Liberty Bell Bay operations and initiating a sales process to find a new owner for this critical piece of infrastructure,” Mr Kelly said.<\/p>\n
The Australian Securities and Investments Commission (ASIC) applied to wind up and liquidate LBB \u2014 a subsidiary of GFG Alliance, owned by Sanjeev Gupta \u2014 over its failure to lodge financial statements for five years.<\/p>\n
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The Tasmanian government acknowledged the news would be “difficult for workers, their families and the local community”. (ABC News: Maren Preuss)<\/p>\n
The case came before the New South Wales Supreme Court on March 16, and will continue separately from the administration process.<\/p>\n
Major lender White Oak Commercial Finance \u2013 a secured creditor \u2013\u00a0made the decision to place LBB into administration.<\/p>\n
Federal Industry Minister Tim Ayres said GFG had failed to provide “a clear future pathway for workers, the community and local businesses”.<\/p>\n
“We understand that this news will cause further uncertainty for workers,” Mr Ayres said.<\/p>\n
“The government will work closely with the administrators and the Tasmanian Government to ensure workers and local suppliers are supported and receive appropriate assistance.”<\/p>\n
Tasmanian Industry Minister Felix Ellis said a meeting of the Bell Bay response team would be held “urgently”, and acknowledged the news would be “difficult for workers, their families and the local community who have already endured prolonged uncertainty”.<\/p>\n
A GFG Alliance spokesperson said the company would cooperate with administrators “to achieve the best possible outcome for all stakeholders”.<\/p>\n
“Liberty Bell Bay had faced a challenging 20 months due to the force majeure declared by its main ore supplier, a significant deterioration in market conditions worldwide, and rising costs,” the statement reads.<\/p>\n
“We also acknowledge and thank the Liberty Bell Bay workforce for their professionalism and commitment throughout this challenging period.”Uncertainty and turmoil<\/p>\n
Australian Workers Union assistant secretary Robert Flanagan said the administration process was a better option than the business going into liquidation.<\/p>\n
“The administration process offers potentially a future for the site,” he said.<\/p>\n
He said the whole process has been a “roller coaster” for employees.<\/p>\n
“They’ve been very anxious about what their future looks like since May last year,” Mr Flanagan said.<\/p>\n
“We’re hoping that this is a process that leads to an outcome, where production can resume and things can get back to business as usual.”<\/p>\n
The smelter is the only manganese alloy smelter in Australia, and was bought by GFG Alliance in 2020 following a period of uncertainty under its previous owner, South32.<\/p>\n
But the smelter’s future was again unclear when GFG’s financier Greensill Capital collapsed in 2021.<\/p>\n
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Liberty Bell Bay was given a $20 million Tasmanian government loan last year that was used to buy a 23,000-tonne shipment of ore. (ABC News: Maren Preuss)<\/p>\n
GFG’s Australian operations went through a period of turmoil, including the South Australian government forcing its Whyalla steelworks into administration<\/a> due to an estimated $300 million in debts.<\/p>\n