Liberty Bell Bay smelter was insolvent for over a year before closing, administrators say

Administrators examining the collapse of Liberty Bell Bay, a manganese smelter in Tasmania, say the plant had been insolvent for more than a year before it closed. The finding raises questions about the state of the company's finances well before its eventual shutdown, and about what was known at the time by those involved in approving the loan.

The Tasmanian government had extended a AUD 20 million loan to the smelter, which administrators say was already in financial difficulty at the time the loan was approved. The company has since ceased operations, leaving workers and creditors facing uncertainty over unpaid debts and entitlements owed to them.

Administrators said they plan to set out their findings in more detail in a formal report to creditors in the coming weeks. The case has drawn attention to the level of scrutiny applied to government financial support for struggling industrial companies before public money changes hands.