Daniel Ricciardo-promoted Quintis sandalwood company collapses

Daniel Ricciardo-promoted Quintis sandalwood company collapses
Daniel Ricciardo-promoted Quintis sandalwood company collapses

The Perth-based sandalwood company Quintis has collapsed, with KordaMentha now in administration, following Friday’s decision by a US fund manager to exercise an option demanding Quintis buy back $37 million of sandalwood plantations.

“The company does not have the financial resources available to it to pay the put option price and the directors have therefore resolved to appoint Richard Tucker, Scott Langdon and John Bumbak of KordaMentha as voluntary administrators of Quintis and its Australian subsidiaries,” Quintis said in a statement.

“We are very disappointed with this outcome given the huge efforts made over the last nine months to recapitalise the company in order to deliver its sustainable future,” Quintis chairman Dalton Gooding said.

It is understood noteholders with $US250 million invested in Quintis intend to appoint receivers and managers from McGrathNicol, over the administrators to protect their interests.

Quintis owns more than 3000 hectares of Indian sandalwood plantations across Australia’s north and manages a further 2000ha on behalf of other investors and growers.

The collapse of the high-flier, which had previously used former cricketer Adam Gilchist and F1 star Daniel Ricciardo to promote its business, follows failed hopes for a recapitalisation or buyout needed to survive.

The former cricketing great Gilchrist and F1 racing ace Daniel Ricciardo proudly announcing themselves as Quintis ambassadors in early 2016. 

The pair met in 2015 through listed sandalwood producer TFS Corporation, which was rebranded Quintis, which Gilchrist sat on the board of until 2014. 

In December 2016, Quintis shares topped $1.70, valuing the group at nearly $700 million. Its shares last traded at 29.5¢.

Its former managing director Frank Wilson has been critical of Quintis’ financial performance since he left to pursue a buyout in March last year.

The local paper reported on the weekend Wilson was involved in an angry clash with a company executive at a western suburbs shopping centre last year.

Wilson alleged Quintis reacted to the confrontation by delaying site tours organised for Wilson as part of the due diligence associated with his proposed buyout of the company, citing its duty of care to employees.

Timbercorp, a MIS that had 18,500 investors invest into $2bn worth of tax effective timber projects over 17 years, was an earlier collapse in 2009.

Investors were advised that a TFS investment of $9,405 got 35 trees, that equates to 700kg of heartwood which could sell for $135 per kg giving $94,500, reflecting an internal rate of return of 15%, but then paying $605 per lot per annum with an expected year of harvest 2032 (15 years). 

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