Four Blue Sky directors have lost a combined $37 million from the value of their shares since late March.
Four Blue Sky directors have lost a combined $37 million from the value of their shares since late March.

Share rout costs Blue Sky directors $37m

THE boardroom survivors of beleaguered Blue Sky Alternative Investments may not have two pennies to rub together once the rout in the company's shares is over.

The four current directors - Kim Morison, Tim Wilson, John Kain and Phil Hennessy - have seen a staggering $37 million chopped off their combined holdings in the company since US short seller Glaucus alleged that Blue Sky inflated asset values, misrepresented its performance and charged exorbitant fees.

The shares have lost almost 23 per cent in the last two days after warning it will take a $59.4 million hit to its bottom line this year. The shares closed yesterday at $1.73, 35 per cent below below the $2.66 target price Glaucus slapped on the stock earlier in the year. At the time Blue Sky shares were trading $11.43. The combined value of the directors' shares is now worth a paltry $6.6 million.

Blue Sky is now restructuring the business and plans to terminate several retirement living projects along with a student accommodation development.

The former market darling's share price could fall further, according to market watchers, if more bad news lobs in the coming few weeks. Morison, who is the firm's managing director following the departure of Rob Shand, says the firm has made some "very tough decisions" including laying off staff and slashing $3.8 million in costs.


THE Russians are coming! Well at least the guys who work for the Russians and their big mining operations. The Energy, Mines and Money conference kicks off at the Brisbane Convention & Exhibition Centre next Wednesday with global investors responsible for managing $718 billion in funds in attendance along with mining industry leaders.

Among the VIPs will be Graham Chapman, an advisor to SUEK, Russia's largest coal producer. SUEK was founded by Russian oligarch Andrey Melnichenko, who by the way owns two superyachts, one of which resembles a submarine and is worth $300 million.

Chapman will be joined by other mining bosses including Whitehaven Coal's Paul Flynn, Central Petroleum's Richard Cottee and China Hanking Holdings chief executive Greg Pan.

It is all shaping up to be a big week for Queensland Resources Investment Commissioner Todd Harrington, who says the conference is a big coup for Brisbane. The Mines and Money conferences, now a signature event on the annual investment calendar, are also held in New York, Hong Kong and London. "The pendulum has definitely swung back to the mining sector in Queensland," says Harrington.


THERE was a big turnout for the funeral of Brisbane's much-loved timber king Malcolm Finlayson on Tuesday. More than 400 people turned out for the service at St Lucia Uniting Church, where Finlayson was remembered as a talented business leader and family man. Leaving school in 1955, Finlayson went to work in the family timber business, which was then called Pattersons and stood on land now occupied by Toowong Village shopping centre. In the early 1980s, Finlayson wanted to buy out the business from the other partners and enlisted the help of friends Aub Lawson, an accountant from Touche Ross, Hugh Gresham and Sir Robert Mathers, of Mathers Shoes fame. The rest, as they say, is history. Finlaysons now employs close to 400 people with saw mills at Yarraman, Imbil and Melawondi. Finlayson died on June 4 aged 78. His sons Skene and Michael will continue his legacy.


WE hear the planned $10 billion Brisbane-Melbourne Inland Railway is not exactly setting hearts aflutter in the investment community.

Brisbane broker Charlie Green attended an Australian Rail Track Corporation (ARTC) presentation on the project recently and the phrase "pigs might fly" was soon running through the money man's brain.

A big flaw was immediately apparent in that the line did not have a dedicated line to the Port of Brisbane, with goods having to travel along the Brisbabe suburban rail network before being loaded onto ships. Green says for a cotton farmer in Goondiwindi it could be cheaper and quicker to truck his crops across the border to North Star at the top of the refurbished NSW/Victoria tracks, and rail that to a port in Sydney or Melbourne. "So the Port of Brisbane could become some version of a white elephant with less trade not more," he says.


BRISBANE-BASED Metro Mining announced the departure of its first shipment from the Bauxite Hills Mine last month. Alert shareholders and avid watchers of Marine Traffic.Com now tell us the fourth shipment has recently set sail from Port of Skardon River, 95 km north of Weipa. Metro has announced initial shipments are bound for China's Xinfa Group - one of the largest integrated aluminium companies in the world.

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