Former Quintis boss Frank Wilson has described the hard-pressed sandalwood grower’s threat to pursue him over an alleged default on $11 million of company loans as “unnecessary” and “disappointing”.
Quintis yesterday took aim at its founder by flagging “enforcement action” over $11.1 million Mr Wilson owes under loans taken out with its finance subsidiary to fund the purchase of sandalwood plantations.
The Perth-based group says Mr Wilson has missed repayments, putting him in default.
Mr Wilson rejects the claim and says he will defend any legal action over the loans.
“The enforcement action foreshadowed by the company … is unnecessary given I was in discussions in good faith to resolve any dispute over this matter,” he said in a statement.
He also said the value of the sandalwood plantations Quintis holds as security far exceeded the value of the loans.
Quintis declined to comment but one estimate yesterday put the value of Mr Wilson’s trees at more than $60 million.
He also has a put option which gives him the right to sell back his personal plantation interests to Quintis for $15.8 million in September 2018.
The former WAFL footballer left Quintis suddenly in March to pursue a takeover offer for the group in partnership with an unidentified party.
He is linked to one of several takeover and equity offers Quintis is looking at with a view to a recapitalisation it admits is critical to its survival.
With $17 million in cash at the end of May — an $11 million sale of discounted sandalwood oil last month provided some relief — Quintis needs a refinancing or a takeover before its reserves are exhausted.
The company itself has avoided a default on $US250 million ($320 million) of bonds issued last year by winning a waiver from bondholders on the requirement that it publish quarterly financial statements.
Quintis has also won breathing space elsewhere, confirming the delayed exercise of another put option, held by Hong Kong hedge fund Davidson Kempner, requiring it to buy back $34 million of sandalwood trees.
The exercise window has been pushed out by two weeks to between July 24 and July 26.
Shares in Quintis have not traded since May 12, when they were put into a halt after a three-day plunge on disclosure issues stripped 76 per cent from the group’s value.
They are not due back on the trading boards until next week.