One-time bankrupt mining prospector Anton Billis was once so close to his friend, convicted fraudster Michael Giovinazzo, he was the best man at his wedding, loaned him tens of thousands of dollars for legal issues, and even “generously” gave him a Nissan Patrol for free.
But that 25-year friendship is now in tatters, being pored over in the Victorian Supreme Court, having broken down over an investment in a micro-cap ASX-listed company seeking to cash in on the critical minerals mining boom.
Four years ago, Golden Plains Resources – a company Giovinazzo co-founded but was unable to act as director for because he had once been incarcerated for fraud – entered into a commercial agreement with the publicly listed Rimfire Pacific Mining, which was at the time barely trading for 1¢ a share.
Under the deal, Golden Plains Resources, an investment vehicle company, would pay $4.5 million to Rimfire over three years for a 50.1 per cent stake in a mining project, known as Fifield. A year later, Golden Plains Resources agreed to pay $7.5 million for another mining project, known as Avondale, for a 75 per cent stake.
But Giovinazzo did not have that type of money, so he turned to his long-time friend, Billis, who a year earlier had loaned him $14,600 for a legal bill, for financial reprieve, according to documents filed in the Supreme Court.
Justice Michael Osborne is now being asked to rule on whether Billis loaned Giovinazzo $3.8 million over a two-year period that would be repaid, or, as Billis claims, in return for a majority shareholding in Golden Plains Resources.
“As at May 2020, Giovinazzo was a man possessed of ambition but bereft of the resources required to pursue commercial opportunities such as those embodied in the Fifield agreements,” Billis’ barrister Damien McAloon wrote in his closing submissions.
“He lacked the collateral that would enable him to borrow funds from third-party commercial lenders. Such assets as Giovinazzo held, or had access to, were illiquid, unconventional and speculative, the value of which could not be objectively determined.”
Between September 2020 and May 2022, Giovinazzo had turned to Billis several times to help repay his Rimfire deal. Giovinazzo told the court that Billis never directly transferred the money to him, and the funds were paid either to his company, Golden Plains Resources, or Rimfire.
At the heart of the court stoush now between the two long-term friends and mining prospectors is who has control over Golden Plain Resources, and a greater stake in Rimfire, which has tripled in value since Giovinazzo struck his initial deal. Today, Rimfire’s shares are worth about 3¢.
Giovanazzo claimed his long-term friend was attempting to “steal” his company and exert more pressure on the board and directors of Rimfire.
Damien McAloon, Anton Billis’ barrister
Giovinazzo has claimed Billis was given shares in other companies as a security to advance the funds to help him pay his agreement with Rimfire, and that he had become a non-beneficial shareholder in Golden Plains Resources. Meanwhile, Billis claimed he was under the impression, as had been agreed, that he was a beneficial shareholder of Golden Plains Resources.
The friendship had become incredibly tense over that period, and, according to Giovinazzo, broke down in 2022 when they finalised a repayment deed.
Giovinazzo told the court various drafts of the deed were circulated between the pair, “each of which contemplated by one means or another that the [Golden Plains Resources] shares would be returned to [his] control upon repayment”, but at the end, Billis refused to sign it.
Billis claimed he had only just been made aware his shares in the company were not held beneficially, while Giovinazzo claimed his long-term friend was attempting to “steal” his company and exert more pressure on the board and directors of Rimfire.
“Mr Billis was an unreliable witness,” Giovinazzo’s lawyers wrote in their closing submission. “He had a very poor recollection of the key events in the proceeding. He was frequently confused as to the dates and order of events and gave frequently contradictory evidence.”
Golden Plains Resources has a 4 per cent stake in Rimfire, according to S&P Capital IQ, while Billis, through various entities, holds 3.4 per cent of shares.
As the court battle plays out, Rimfire watches on, aghast at Billis’ potential control of the company, which has a market cap of $67 million. Ahead of the most recent annual general meeting, in which Billis put up resolutions to appoint two new board members, the board raised alarm bells.
“If [those resolutions] are passed, the board will comprise a majority of directors nominated solely by Mr Billis,” they told investors.
“The board considers that this is not good corporate governance and gives Mr Billis the potential to control the business and operations of the company without him paying a premium for that control.”
Eighty-five per cent of shareholders voted Billis’ motion down.
Giovinazzo was contacted for comment. Billis declined to comment as the case was before the court.
The matter returns to court this month.
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correction
A previous version of this story incorrectly attributed comments to Anton Billis’ lawyers, in fact the comments were made by the opposing counsel.