Legal action against troubled smelter dropped
The corporate regulator has dropped legal action that could shut down Australia’s only manganese smelter.
A buyer is being sought for the troubled Liberty Bell Bay in northern Tasmania, which went into voluntary administration in March.
The smelter, a subsidiary of GFG Alliance owned by controversial businessman Sanjeev Gupta, has been lying idle for almost 12 months.
Corporate regulator ASIC announced on Thursday it had dropped a High Court case against Liberty Bell Bay over alleged non-filing of tax returns for five financial years.
As part of the lawsuit filed in March, the regulator filed to close the smelter and accused it of failing to comply with a court order to provide tax returns.
The regulator said in a statement that court proceedings had been “suspended”.
The statement said, “Administrators have been appointed to the company.”
“As a result, obligations to comply with financial reporting requirements have been deferred as management moves forward.”
The future of around 200 workers at the smelter remains uncertain as managers Ernst and Young try to find a buyer.
On April 22, the federal and state governments announced a $3 million loan to guarantee wages for three weeks after managers said they would run out of money to pay 175 workers.
Ernst and Young has previously said there are a dozen potential buyers for the smelter, which produces alloys to strengthen steel.
The smelter’s operations had been under cloud for some time.
In August, the Tasmanian government loaned Liberty Bell Bay $20 million to buy ore so it could continue operations.
However, when operations did not resume, the government appointed trustees and managers in January to protect the ore stock.
Federal Industry Minister Tim Ayres said GFG Alliance had closed the plant but it remained efficient and markets and customers were keen to buy its products.
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