Just days after the debt-ridden South Johnston Mill revealed that it would go into receivership (24 January, click here to read article), a consortium has offered a A$17m rescue package.
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The group, brokered by Cardwell and Johnstone shire council representatives, consists of cane farmer cooperative Tully Sugar Mill, Ergon Energy Corp, and Thiess, with the latter two contributing A$3.5m to the deal each.
The new negotiations have topped the previous offer of A$14.2 from Bundaberg for the sugar mill, which was established in 1916 and processes 3% of the nation’s sugarcane. The mill’s dramatic down turn is seen as symptomatic of the sugar industry’s integral problems.
Rick Dennis, the receiver with Ernst & Young appointed by the National Australia Bank, South Johnston’s major creditor, maintained that he would still consider a settlement from both parties: “[We have] another fortnight to negotiate the sale of the mill’s assets. There is not a great deal of progress on that, except to say we have continued to talk to Bundaberg Sugar and others.”
Meanwhile the fate of the South Johnston Mill’s 130 workers and 300 farmer-owners hangs in the balance.
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By GlobalData
