Forge in voluntary administration: sources

Mining Photo: Rob Homer
Mining Photo: Rob Homer

Insolvency firm Ferrier Hodgson has been appointed as voluntary administrator by the board of bankrupt contractor Forge Group, sources close to the situation told The Australian Financial Review's Street Talk.

The next step is that lender ANZ Banking Group will take control by appointing KordaMentha as receiver.

ANZ extended Forge an additional $11 million line of credit in the past fortnight, which was being used to pay Forge employees and for other working capital expenses.

The support was conditional on Forge finding an equity backer, and the company had adviser Euroz on the search for a white-knight investor. Potential buyers had been told ANZ have been “working with Forge management”.

It’s understood Forge came to the conclusion over the weekend it would not be able to find the equity piece. So ANZ withdrew its support.

The mining services player was teetering on the edge of administration last November, before ANZ jumped in with an emergency financing package. ANZ had been working with KordaMentha.

This story Forge in voluntary administration: sources first appeared on The Sydney Morning Herald.