No discount on rates from Labor whisperer

You’d think insolvency practitioners who orchestrated an ailing asset’s passage through insolvency once might offer a discount if asked to do it again.

Don’t they know the business backwards? Did they not at first bite set it up for success?

Not apparently if the business is Onesteel’s troubled Whyalla steelworks in South Australia and the firm appointed to steward it towards new ownership for a second time is KordaMentha.

In those circumstances, the firm founded by Mark Korda and Labor whisperer Mark Mentha in the wake of the collapse of ANSETT is going for the lot.

Not content with extracting a $400 million indemnity from a desperate premier Onesteel appointees Lara Wiggins, Sebastian Hams, Mark Mentha and Michael Korda will also be charging out at the firm’s 2025 rates of $950 per hour, well above the market average.

Regrettably for South Australia’s taxpayers Bruce Carter, the man dispatched by South Australian Peter Malinauskas to seek a consent didn’t insist that the appointment be conditional on the administrators charging out at the 2024 rates.

It would have been a nice gesture given Mentha took Carter’s first call two days before Christmas.

But it’s all about how you look at it. One might think KordaMentha was lucky to be asked given their administration of the Whyalla’s previous corporate owner the Arrium Group ultimately led to the business’s acquisition by Gupta, who’s failed to deliver on solvency, let alone on the green steel fever dream.

But on the other hand, Mentha’s impeccable Labor network make it difficult to imagine any other insolvency firm being considered.

KordaMentha is after also providing CFMEU administrator Mark Irving KC with a special purpose audit of the scandal-riddled union.

And it was Mentha who was depicted as saving Whyalla the last time the town’s primary employment driver stumbled under the weight of its ageing steelworks and moribund work practices back in April 2016, though he had first to wait for the initial appointees from Grant Thornton to be unceremoniously pressured into vacating.

This time it will be very different with Australian taxpayers stepping into the ownership shoes thanks to the state and Federal Governments not prepared to risk the collapse of the township in an election year.