Message from Rod Steel: Wednesday, December 30, 1998
Investor group aims to keep
Bresea alive
With $25-million in bank, group says Bresea not
insolvent
By CAROL HOWES
The Financial Post
CALGARY -- A small group of investors in
embattled Bresea Resources Ltd. is attempting
to keep the company alive.
Rod Steel, who claims to represent about 75 investors with
more than 1.5 million shares, said yesterday the group has no
intention of allowing the affiliate of Bre-X Minerals Ltd. to slip
quietly into the history books.
Bre-X went bankrupt last year after its Indonesian gold find was
declared a fraud.
"We think Bresea should keep operating because it's the only
way we can get a fair return on our investment," said Mr. Steel,
who lives in Portland, Ore.
Mr. Steel said he and the rest of the group are counting on the
appointment of a shareholders' board to lead the effort to turn
Bresea into a viable company.
Two weeks ago, a Court of Queen's Bench of Alberta approved
the establishment of a five-member advisory board and gave
lawyers the go-ahead to explore a settlement with shareholders.
Mr. Steel said he hopes a representative will be chosen from his
group so their concerns will be heard. The board will be selected
over the next two months to assist the court-appointed monitor in
restructuring Bresea.
Calgary-based Bresea is under court protection from creditors.
It has 65 million shares outstanding.
Calgary lawyer Clint Docken said investors in Bresea could see
repayment of up to $30-million by next spring in what would be
the first payout in the $6-billion gold hoax. Bresea has about
$25-million in cash and another $5-million in assets that includes
the building that once housed Bre-X.
Mr. Steel said while monitor Pricewaterhouse Coopers Inc. is
wrapping up a number of outstanding matters relating to Bresea,
the company remains solvent.
"I think they've got a long way to go," said Mr. Steel, who owns
22,000 shares. "That money can't be distributed to shareholders
unless the court agrees it [the company] is insolvent. It's hard to
call a company with $25-million in the bank insolvent."
Bresea was the first company David Walsh formed in the early
1980s. Bresea owned 25% of Bre-X, which owned 18% of
Bresea.
Mr. Steel said some members of his group first made a request
in late 1997 to have a new board of directors appointed to
Bresea. The group offered a slate of individuals from the mining
industry, but the monitor turned it down.
The group has not hired a lawyer, he said, and is trying to work
through the system.
------
Previous
|
