Creditors get a rise out of One.Tel wind-up

Creditors of the defunct One.Tel, who've voted unanimously to wind up the company, will receive between 20 and 50 cents in the dollar--a better return than they'd expected.

SYDNEY (ZDNet Australia)--Creditors of the defunct One.Tel, who've voted unanimously to wind up the company, will receive between 20 and 50 cents in the dollar--a better return than they'd expected.

Creditors had earlier been told to expect a return of no more than 11 to 37 cents in the dollar.

The increased return was due to “the speculative values” of One.Tel’s spectrum and Hong Kong assets, according to administrator Steve Sherman.

Creditors voted against an adjournment to consider former executive Jodee Rich’s last minute deed of company arrangement, in a show of hands 115 to 15, at today’s second creditors’ meeting in Sydney.

Rich’s proposal would have prevented the company going into liquidation and seen two pools of creditor funds set up – from an undisclosed funder--one for general trade creditors and the other for secured creditor Lucent.

The proposal included an indemnity clause that there be no further action against the telco’s former executives.

The administrator said it “was not in a position to make a recommendation” whether or not creditors accept the proposal, but “the creditors themselves voted it down”.

Staff entitlements will be received in full within 14 to 21 days, Sherman said.

”At the moment, it’s not anticipated that the shareholders of One.Tel will receive anything,” Sherman added.

Sherman also said that he hopes to conclude something by the end of the week as to the sale of the telco’s Hong Kong assets.

”There is still firm interest in Hong Kong,” Sherman said, adding that it was a profitable operation.

Sherman said he had found no irregularities in One.Tel’s books but said legal action, relating to directors and bonus payments, prepaid advertising and insolvent trading, is under consideration.

One.Tel, backed by Rupert Murdoch's News Corp and Kerry Packer's Publishing & Broadcasting, went into voluntary administration in May with debts estimated to range from in excess of AU$600 million.

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