Nicholas Bolton, the 26-year-old IT entrepreneur who is trying to have toll road giant BrisConnections wound up, now has another combatant to contend with – investment banking giant Macquarie Bank.
Bolton, who established domain name sales company Domain Central in 2003, owns an investment company called Australian Style Investments, which is the largest shareholder in BrisConnections, the company building Brisbane’s $4.9 billion toll road project linking the city and airport.
BrisConnections floated last July at $1, but the unit price quickly plummeted to as low as 1c. Bolton has been able to amass a 19.7% stake for less than $100,000, but there is a huge catch – each unit requires the holder to pay a $2 instalment to BrisConnections, which means Bolton owes $154 million.
Melbourne-based Bolton claims that he, like many BrisConnections shareholders, did not know about the instalments when he bought the shares, and has called an extraordinary general meeting of the company on 9 April in the hope of winding up the company and get out of paying the instalments.
BrisConnections countered by applying to the Victorian Supreme Court to have Bolton’s company Australian Style wound up.
Now Macquarie, which is the joint underwriter on the project, has taken a stake in BrisConnections in the Queensland Supreme Court in an attempt to force all parties to “fulfill their contractual obligations”.
Bolton needs a vote of 75% at the 9 April EGM if his proposal to wind up is to be successful, but Macquarie is likely to be able to use its stake to block the proposal.
But as Business Spectator columnist Robert Gottliebsen reveals, litigation funders IMF are considering applying to the court to prevent Macquarie from voting at any shareholders’ meeting.
BrisConnections said yesterday that it “welcomes the continued support of Macquarie Group as underwriter and financier to the BrisConnections unit trusts”.
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James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
