The CFE Story - The Answers To Your Concerns., page-5

Now here's what really happened, according to the Australian business review.

Seems they done what any business would do in an effort to cut costs and survive through the hard times. Looks to me that he was doing what he could to retain a workforce by loaning Timis the money for Marampa in an attempt to keep the business, including CFE producing and successful. From previous announcements, CFE have since commenced legal action to recover the money loaned to the Frank Timmis venture.

Extract from the Australian Business Review:

MINING & ENERGY

Tony Sage’s Cape Lambert Resources lays off 117 to cut costs

• The Australian
• 12:00AM January 8, 2015
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• Paul Garvey
  
  Resources reporter
  Perth
  @PDGarvey
  

TONY  Sage’s Cape Lambert Resources has laid off 117 employees and postponed a planned dividend payment indefinitely in response to the weak iron ore price.
And mining services company ADG Global Supply has become the latest corporate victim of the resources industry slowdown, with the Perth-based group slipping into administration.
Both Cape Lambert and ADG are heavily exposed to the West African iron ore industry, which has been all but wiped out by the combination of plummeting iron ore prices and the outbreak of the Ebola virus.
Iron ore prices have halved over the past year, with surging output from Australia and cooling demand growth in China.
Cape Lambert said the lay-offs and a pullback in exploration activities across its portfolio would generate annual savings of about $3.5 million.
The company had been scheduled to pay $12.5m to shareholders in the form of a 2c per share dividend at the end of February.
Cape Lambert was sitting on $58.1m at the end of September, but has subsequently contributed $US20m ($24.7m) into a deal to help fund an acquisition of the Marampa iron ore mine from the collapsed London Mining. Cape Lambert is the key business venture for Mr Sage, whose string of corporate interests includes the ownership of the Perth Glory soccer team.
The Marampa deal saw Cape Lambert partner with a private company of Frank Timis, the mining entrepreneur and close friend of Mr Sage. Mr Timis’s other key venture, African Minerals, suspended operations at its Tonkolili mine next to Marampa at the start of December due to low iron ore prices and a lack of funding.
Mr Timis has since struck a deal to use the workforce and infrastructure at Tonkolili to resume operations at Marampa.
The suspension of mining at Tonkolili appeared to be a death sentence for ADG.
The contractor appointed PPB Advisory as administrators late on Tuesday after concluding there was likely to be “extensive delays” in collecting the $1.5m owed to it by African Minerals.
ADG, which employed 50 people around the world providing supply chain management services to a number of clients in the resources sector, had been suspended from trading for over a month as it sought to clarify when it would be paid the outstanding amount. Its shares last traded at 1.1c each, giving it a market capitalisation of just $3.5m.
West Africa’s fledgling iron ore sector has been routed by the fall in iron ore prices. In addition to the shutdown of Tonkolili and the collapse of London Mining, Bellzone Mining suspended its iron ore operations in Guinea and halted trading in its shares last September.
In a statement, Mr Sage said the company’s cost-cutting and postponement of the dividend represented “prudent capital management” in light of the iron ore price drop and broader mining sector downturn.
“Cape Lambert as a company is in a strong commercial position and taking these measures is sound management to protect the company in what is a hard time for the mining sector,” Mr Sage said.
“However, Cape Lambert is confident that the iron ore price will recover in the near-to-medium term and the dividend payment can resume in due course.”
It is understood the bulk of the company’s retrenchments will be made to the in-country teams working on its portfolio of West African iron ore exploration projects. Cape Lambert shares fell 1.5c or 16.7 per cent to 7.5c each.
The pain at Cape Lambert and ADG contrasts with the fortunes of Australia’s mid-tier iron ore miners. After copping a battering in 2014, shares in Atlas Iron, Arrium and BC Iron have enjoyed a positive start to the New Year. Arrium jumped 15.9 per cent yesterday, while BC Iron climbed 8.7 per cent and Atlas added 7.8 per cent.



http://www.theaustralian.com.au/bus...s/news-story/bf6a69ef61b2cd97f15d1dae07175f66