PracticeConsultingE&Y report sends One.Tel into administration

E&Y report sends One.Tel into administration

One.Tel, the Australian telecoms company, has appointed administrators to 'assist the company and address its immediate cash position'.

One.Tel, which numbers media tycoons Rupert Murdoch and Kerry Packer among its major shareholders, has made the move following a due diligence investigation by its auditors Ernst & Young.

The probe found a planned rights issue of $132m (Pounds 92m) would fail to keep the company solvent, and could, therefore, not proceed.

Following advice from E&Y and management, the Board of One.Tel appointed Steve Sherman and Peter Walker of Ferrier Hodgson as administrators and suspended trading of its shares on the Australian Stock Exchange.

Sherman said he estimated a net debt of $180m, but said that the company would continue to operate as a going concern while a review was underway. He said employees would continued to be paid and said One.Tel’s offshore operations in the UK and Europe were not under administration.

‘We will review One.Tel’s operations and hold discussions with its major creditors to identify the best means of maintaining value for the benefit of its stakeholders,’ Sherman said.

While unwilling to comment on the state of the company’s liquidity, Sherman told a media briefing in Sydney: ‘I’m not overburdened with cash as we presently speak.’

Links

One.Tel online

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