Nathan Tinkler’s bid to buy the Newcastle Knights has is in doubt, with the mining magnate unable to meet crucial financial commitments in time for the handover deadline today.
Tinkler’s Hunter Sports Group’s (HSG) chief executive Troy Palmer and executive chairman, Rob Tew requested an extension for Tinkler to fulfil his obligations in a meeting with the Knights board of directors yesterday.
A statement from Knights chairman Ken Edwards given to The Sydney Morning Herald confirmed Tinkler’s inability to meet the requirements by the deadline.
”HSG directors Ken Edwards and Troy Palmer this morning advised the board of the Newcastle Knights that HSG is not in a position to complete the transaction by June 30 for a number of reasons, including an inability to pay the existing liabilities as well as an inability to provide a bank guarantee by that date,” it states.
”The Knights board has been told it will be provided with a representation from the HSG regarding their request for an extension of time to complete the transaction, together with detail of when the bank guarantee will be available and liabilities paid.
“In light of the pressing nature and scale of the existing liabilities, the board of the Newcastle Knights will consider the HSG request with appropriate gravity, once more detail surrounding the timing of the payment of liabilities and provision of the bank guarantee is known.”
Palmer told the Herald last night the company’s request for an extension did not mean the takeover was in jeopardy.
Tinkler’s company assumed control of the NRL club in March when 97 per cent of members voted in favour of privatisation at an extraordinary general meeting.
The billionaire has promised to pay the Knights’ debts, estimated to be worth more than $3.5 million.
He will also provide a bank guarantee of $20 million.
Palmer told the Herald both those pledges could be honoured by August 10 and said ”a lot of moving parts” and the complexity of the deal had caused delays.
”Once it is all in place the final exchange of the money will be done, the bank guarantee will be handed over and we’ll have full ownership of the Knights,” he said.
Palmer denied Tinkler could not make up the cash on the due date.
”That’s incorrect,” he said.
“I think Nathan’s financial position is well documented.
”We’re just following normal business procedures in completing a deal.
"We’ll continue to work with the board to complete this deal ASAP.”
Tew told the Herald on Sunday that if HSG couldn’t meet today’s deadline, the matter would return to members, who would be asked to vote on offering a time extension.
Further talks are expected between HSG and Knights directors today.