We did the right thing on Bolton deal- Brisconnections chief

The chairman of Australia's largest infrastructure project, Brisbane's $4.8 billion Airport Link, has defended his role in last week's deal that saw a motion to wind up the company in charge of the project defeated.

The corporate watchdog ASIC is investigating the $4.5 million deal between Leighton's subsidiary Thiess and Melbourne entrepreneur Nicholas Bolton, which condemned many small investors to likely bankruptcy.

After proposing a motion to wind up the company, Mr Bolton sold his proxy votes to Leighton's in a deal that netted him $4.5 million and could force retail investors to pay the further two $1 instalments on the partly paid Brisconnections shares.

Brisconnections chairman Trevor Rowe received the proxy votes on Easter Saturday but did not inform any of the project's other shareholders ahead of the Tuesday meeting.

"We received the proxies mid-afternoon on Easter Saturday and I was advised we had received those proxies, but we were mindful that he may well have turned up at the meeting and of course he would have the ability to vote contrary to the proxies he lodged," he told ABC 1's Inside Business program.

"You don't normally disclose the proxies you have received. I was advised what the proxies tally was, I was advised they included voting against the resolutions they had proposed and I was just looking at the totality of it

"The company secretary registry did the rest."

Mr Rowe confirmed he was approached by Mr Bolton with an offer to buy the proxies but says he baulked at the asking price.

"Macquarie Bank was involved apparently in discussions with him, they had called me in the week prior to say... did I mind having a conversation with one of his advisers," he said.

"I called that adviser, I asked him what he had in mind, he mentioned some numbers to me, I said I thought they were pretty excessive and I gave him a lower number.

"He said Mr Bolton needs $5 million otherwise he is not going to do this, I then rang off and we thought about it and we decided that we would not engage further in that exercise."

He says he has been working very hard to look for a way to avoid forcing unit-holders to pay their further instalments.

This includes trying to arrange for the underwriters (Macquarie Bank and Deutsche Bank) to take responsibility for the units.

"We have put a lot of effort [into this], because we have some sympathy for those genuine people that have suffered as a result of either the market lliquidity in the stock given the environment in which we find ourselves or alternatively innocently did buy this perhaps without recognising there is an instalment receipt," he said.

"Macquarie Bank have come a long way to endeavouring to address this issue, you recall they put a proposal to us early last week, unfortunately they couldn't come to terms with Deutsche Bank and at the end of the week unfortunately had to advise us that proposal have to be withdrawn,

"But that hasn't stopped us continuing, subsequent to the meeting, to see if we if we can find some solution for these unit holders."

He says the project must continue because it is a worthwhile economic venture, but he recognises that it could "go down to the wire".

The next instalments on Brisconnections shares are due on April 29.

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Sun 19th April 2009 - 10:14am