SIRONA CAPITAL MISS DEADLINE FOR $6.65m SPICER PAYMENT
CLAIMING “THERE IS NO DEBT”
Sirona Capital, after gaining an additional six month extension from Fremantle Council to settle the $6.65m payment for the Spicer Site did not settle on the amended due date, 30th September 2018.
The Spicer site has been described as a part of the The King’s Square Plan (KSP) a joint venture between Fremantle Council and Sirona Capital and is designed to revitalise the city’s centre.
COUNCIL: “SETTLEMENT … NOT YET HAPPENED”
On the 8th October Fremantle Backchat were informed by the council’s administration that: “Settlement of the sale of the former Spicer site has not yet happened, however the agreement for the City of Fremantle to sell the property to Sirona (Capital) remains in place.”
A City administration spokesperson continued in an email “… under these circumstance The City and Sirona will now be subject to this process which involves a 30 working day period for settlement to occur”.
That takes the settlement day to Friday, 9th November.
SIRONA: “THERE IS NO DEBT”
A spokesperson for Sirona Capital said in an email to Fremantle Backchat: “ I understand you have also approached the City of Fremantle on this topic and they have responded. However, I cannot allow your interpretation of the commercial arrangement between the City and Sirona to go uncorrected. We have entered into a contract for sale with deferred settlement terms. There is no debt.”
This statement leads to some confusion. Sirona claim “There is no debt”, the City claim the debt has not been paid on the due date but a process, presumably to agree a settlement, is part of a contract.
Fremantle Backchat have approached Sirona Capital to clarify the ‘no debt’ statement. There was no reply at the time this story was published.
COUNCIL MINUTES DEFINED DATE
The date for settlement was stated unequivocally in the Council’s minutes for the 11th April 2018 General Meeting:
“COUNCIL DECISION ITEM FPOL1802-12 (Committee Recommendation)
Moved: Mayor, Brad Pettitt Seconded: Cr Dave Hume
That Council authorise the Chief Executive Officer authority to approve extension of the settlement date for the former Spicer property for a period up to 30 September, 2018, and amend the Project Development Deed in accordance with this extension.”
LACK OF TRANSPARENCY
For some years questions have been raised regarding the lack of transparency surrounding the KSP. Financial analyst Martin Lee together with Claudia Green, a former candidate for City Ward, exposed flaws which indicated the financial plans were not sustainable and that ratepayers could face a debt of up to $50m.
In January this year Sirona Capital had a writ issued against it claiming the directors had acted “fraudulently”, “negligently” and made “misrepresentations” related to the conversion of a $5m loan into equity. The writ, issued by Cooper and Oxley’s administrators was seeking $5 million plus 15% interest on that sum since late 2011, about $1.2 million, plus unspecified damages.
This occurred at the time $6,65m was to be paid to Fremantle Council for the Spicer Site. Sirona Capital instead requested a further postponement of 12 months. Council granted six months.
The writ was claimed to have been “settled” by Sirona MD Matthew McNeilly though the administrators for Cooper and Oxley did not confirm that settlement when Fremantle Backchat requested clarification.
SIRONA CLAIMED: “BACKING OF $190m”
These events occurred before Sirona announced they had secured financial backing for the King’s Square plan of $190m from superannuation fund managers FSS.
The question is why, with this financial backing for the KSP, of which the Spicer site has been named a part, could the company not pay $6.65m on the due date?
On 15th June 2018 Fremantle Backchat questioned Sirona Capital’s solvency. <https://wp.me/p3YA9m-zA>
SIRONA DIVIDED & LOSE $100m
On September 25th 2018 joint statements from Sirona Capital and Harvis outlined that the Sirona’s two managing directors had divided Sirona Capital. Kelvin Flynn left Sirona and formed Harvis taking $100m of assets and a number of Sirona’s principle executives, leaving Matthew McNeilly with Sirona Capital, less $100m in assets.