CRC finds a solution: mine outfit rescued
GOLD Coast turnaround specialists have brokered a deal to secure the future of embattled WA mining services outfit Viento.
Under a recovery deal stitched up by Bundall-based CRC Business Solutions, the listed Viento Group signed a Deed of Company Arrangement with distressed debt player CarVal which will save 250 jobs and return some funds to creditors.
The rescue plan comes after the mining services company in late April collapsed into administration, just two weeks after winning a $7.3 million contract for billionaire Gina Rinehart’s mine, Hope Downs, with Rio Tinto.
Viento had posted a halfyear $14.5 million loss through its switchroom-making subsidiary HVLV after a contract blowout at the giant Chevron Wheatstone LNG project and the slowdown in the mining sector led to a breach of bank facilities.
CRC helped drive the cash- strapped company’s turnaround by negotiating a debt restructure with Viento’s bank and creditors and helped the company win $47 million in new Pilbara contracts with BC Iron and Rio Tinto, despite being in administration.
CRC managing director Richard Croaker said dis- tressed debt heavyweight CarVal Investors struck a deal to buy Commonwealth Bank of Australia out of the Pilbara-focused Viento.
CarVal has been circling debt-laden companies in the mining services sector and teamed up in a joint venture with Viento executive John Silverthorne.
“We did a reassessment of the debt and project pipeline and restructured the company with an eye to minimising outgoings and maximising profit on existing revenues,” Mr Croaker said.
“This included a substantial debt reorganisation and payout of the existing facilities.
“In this instance, we went to our global network and spoke with CarVal, one of our offshore funding partners, with over $10 million in funds under management, because we knew they were looking to get a strategic foothold in this space in Western Australia.”
The DOCA secures the jobs of 250 Viento employees and makes provision for employee entitlements.
“During this process our major partners and key customers were incredibly supportive, so much so that Viento managed to win new business while in administration, which is almost unheard of,” Mr Silverthorne said.
Mr Croaker said CRC would continue to work with Viento and its partners to capitalise on further opportunities in the mining services sector.
As a result of its work with Viento, the CRC turnaround team has established a permanent base in WA to service other clients in the area.