KordaMentha asked Lowy what steps he had taken to understand the financial forecasts and viability of New Wilkie Energy before appointing an administrator.

“Mr Andrew Lowy confirmed he was simply acting under the direction of Mr Simon Raftery.”

“Mr Andrew Lowy informed us that he has taken on similar roles at the request of Mr Simon Raftery for several other entities that entered external administration shortly after his appointment. Consequently, we have reported this information to the Australian Securities and Investments Commission.”

Raftery, 42, is a former employee of BRI Ferrier. He set up his own private credit and funds management group, Remagen, in 2013.

In 2023, he was a director of two food companies, In2Food group and Aussie Frozen Fruit, which collapsed in the first half of that year. Those food companies collectively owed about $80 million.

Raftery stepped down as a director of Aussie Frozen Fruit two days before it went into liquidation; Andrew Lowy was appointed a director the same day Raftery stepped down.

At the In2Food group of companies, Raftery stepped down as a director about six weeks before its liquidation, and was replaced on the same day by Lowy.

In both those companies, liquidators have made allegations of potential insolvent trading and potential breaches of directors’ duties. Raftery has repeatedly denied those allegations to this masthead and stated that “no breaches have been substantiated and any suggestion they have been or are likely to be substantiated is completely false”.

Lowy was also appointed as a director of Indus Mining in January this year, a company that is connected with Raftery. Indus Mining was wound up in April by a creditor on the grounds of insolvency and a liquidator was appointed in July.

Raftery ceased to be a director of Indus Mining in 2021.

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Indus Mining was formed by Raftery’s firm Remagen between 2018 and 2019, after it raised $55 million from investors, including asset manager BlackRock, to acquire Watpac Civil and Mining.

Lowy was also appointed as a director of Highwall Mining, a company to which Remagen was a secured lender, with it owed about $11.7 million by that company and others within the group. That group went into liquidation in November 2023. Raftery stepped down as a director in June that year, and Lowy was appointed in September.

Raftery and his firm Remagen, alongside Ben Madsen of Archibald Capital, were involved in organising loans for the New Wilkie group of companies from private investors. Administrators have estimated that between $150 million to $200 million was raised.

Raftery and Madsen are both involved in disputes in the Federal Court involving one of the private lenders and investors in New Wilkie Energy. The private lender and investor was the Hallinan family, which owns Hi-Quality group, an east-coast waste management and logistics firm. They have accused Raftery and Madsen of “misleading or deceptive conduct”, which both men have denied. The case is ongoing.

‘Poor corporate governance’

KordaMentha’s report into New Wilkie Energy also exposed boardroom ructions at the group, which resulted in one director being forced out weeks before the group’s failure. It also claimed “poor corporate governance” was one of the factors contributing to the group’s demise. This included an alleged failure by New Wilkie’s management and board to keep adequate books and records, and also that the group did not hold regular or documented board meetings until mid-2023.

The group also didn’t have a “sufficient qualified or experienced chief financial officer until mid-2023”, and personal email addresses instead of work email addresses were used for company matters, according to the report.

KordaMentha has recommended that the New Wilkie Energy group of companies be put into liquidation.

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Its initial investigations found that New Wilkie Energy was possibly insolvent from June 2023, almost six months before it was placed into voluntary administration, and that the company potentially incurred more debts during that time.

“Our preliminary investigations indicate that since the date of insolvency, which we have estimated occurring around June 2023, the group may have incurred further debts. We are unable to quantify the exact value of those debts due to limited books and records.”

The Wilkie Creek mine only commenced operating in April 2023, which is two months before KordaMentha’s report claims New Wilkie Energy was potentially insolvent.

The Wilkie Creek mine was operated and owned by Peabody Energy from 1994 to 2013, after which it was put into care and maintenance, following multiple failed attempts to sell it.

Finally, in 2021, Peabody sold the mine to a private syndicate, which put it back into operation in April 2023, but only after almost $200 million of funding was raised from lenders and investors.

The Wilkie Creek mine, which lies about 250 kilometres west of Brisbane, was forecast to produce 2.4 million tonnes of thermal coal annually.

While KordaMentha conducted its review into the failed business, FTI Consulting was tasked as receiver to sell the Wilkie Creek coal mine. Binding offers were due in April to buy the mine; four months later, there has been no announcement.

A creditor’s meeting on Thursday was adjourned to allow the receivers more time to complete a possible sale, which will also determine whether a liquidator is appointed.

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