BrisConnections wind-up bid fails

The Age

Wednesday June 3, 2009

LUCY BATTERSBY

BRISCONNECTIONS unit holder Jim Byrnes has failed to have the company wound up in his attempt to block payment of the second instalment on its stapled units.Justice Arthur Emmett, in the NSW Federal Court, yesterday ordered that Mr Byrnes' statement of claim against the toll-road builder and Macquarie Bank be struck out. He ordered Mr Byrnes to pay costs to three defendants - BrisConnections management, Macquarie Advisors and Macquarie Bank."Today's judgement speaks for itself," BrisConnections spokesman Patrick Southam told BusinessDay.Mr Byrnes claimed BrisConnections' product disclosure statement was defective and had not complied with regulations, voiding the obligation for shareholders to pay the second instalment of $1 a unit.But Mr Southam said a unit holder meeting called by a company advised by Mr Byrnes, Brisbane Toll Road Link Pty Ltd, would still go ahead on June 22.BTRL proposed that BrisConnections' management be removed and be replaced by a company called Armstrong Corporate Capital. Although BTRL held a 15.2 per cent stake in the toll-road company, it had not paid the second instalment and subsequently lost voting rights, which made it unlikely the motion would have passed.BrisConnections won a $4.8billion tender in May 2008 to build a toll road linking the Brisbane airport with the CBD. Its stapled units were offered at $3 each when it floated last year, with $1 payable upfront and two further $1 payments due nine months and 18 months after the allotment date.The units quickly fell to 1 after institutional investors dumped their holdings. Hundreds of retail investors then picked them up, unaware of the instalment fee. BrisConnections took internet entrepreneur Nicholas Bolton to court earlier this year to prevent his attempts to wind up the company at a shareholder meeting in April.But Mr Bolton accepted a one-off $4.5 million payment to vote against his own resolutions, and then sold his 77million units to a family friend, who failed to pay the second instalment, which became due on April 29.Two-thirds of unit holders have not paid the second instalment, and BrisConnections is now pursuing them for an outstanding $279 million.