Infinite Green Energy - Case Update

The Supreme Court of Western Australia has granted a further adjournment of a winding-up application against Infinite Green Energy Ltd (IGE) despite the company’s clear insolvency and doubts that the continued administration is in creditors’ best interests.

Perth-based hydrogen developer IGE and nine related entities entered voluntary administration on 7 April, with Richard Tucker and Jared Palandri of KordaMentha appointed as administrators. The company had faced a winding up application by DD Investment WA, a Queensland-based investor, which was scheduled to be heard on 8 April, but the administrators obtained an initial adjournment.

They then issued a report to creditors on 15 May revealing that a group of shareholders had expressed interest in participating in the recapitalisation and restructure of the IGE Group through a DOCA, with the objective of gaining back control of the IGE Group; preserving it as a going concern; securing capital expenditure to spend on the Northam Solar Farm which would improve the viability of the IGE Group; replacing the board; and issuing equity to investors bringing new money (including existing shareholders). No DOCA had been received at that time, so the administrators proposed to utilise their statutory power under s 75‑140 of the Insolvency Practice Rules to adjourn the second meeting of creditors unilaterally to allow negotiations to be finalised.

At the adjourned hearing on 19 May, the administrators sought a further adjournment to 22 July. The administrators argued that the proposed recapitalization would preserve IGE as a going concern and potentially fund development of the Northam Solar Farm. The administrators also highlighted progress in securing $750,000 in shareholder-backed funding and noted preliminary creditor support for ongoing administration, with more than 64% of creditors by value expressing conditional support for a DOCA.

The Court found that the administrators were not entitled to an adjournment under s 440A(2) of the Corporations Act (which requires evidence that continued administration is in creditors’ best interests). The Court stated that it was cognisant that considerations beyond mere quantum may be relevant to take into account in determining what is in the interests of the creditors and whether an adjournment may be said to be in the creditors' interests. There was also no doubt that the administrators had acted with appropriate diligence and haste, and had undertaken appropriate investigations within the time available. However, the Court was not satisfied, based on the evidence, that it was in the interests of IGE’s creditors for it to continue under administration, as distinct from satisfaction that it may be so.

Nevertheless, the Court exercised its general discretion to adjourn. This was influenced by the lack of opposition from the applicant (DD Investment), the support of IGE's receivers (Aaron Dominish, Cameron Shaw, Richard Albarran and Brent Kijurina of Hall Chadwick), and the potential for a DOCA to return up to 15 cents in the dollar—higher than the estimated 0–8.5 cents in liquidation.

Ultimately, the winding-up hearing was adjourned to 22 July, with the Court allowing an earlier resumption if a creditors' meeting is scheduled before then.

Read the decision HERE.

Professionals involved:

  • Chris Pearce of Blackwall Legal for the administrators

  • Martin Bennett and Nilan Ekanayake of Bennett for DD Investment

  • Edwards Mac Scovell Legal for IGE

  • Conor Breheny of Francis Burt Chambers (instructed by JCL Law Partners) for Axpo Servizi Produzione Italia, a creditor

  • Ryan Lennon of Dentons for the receivers