* Padbury declines to say if directors signed off on deal
* ASX could refer Padbury to securities watchdog
* Padbury shares plunge, valuing firm at around A$17 mln
(Adds ASX, Padbury comment)
MELBOURNE/SYDNEY, May 2 Shares in Australia's
Padbury Mining Ltd plunged as trading in the stock
resumed after its plans for a deal to build a $6.5 billion iron
ore port and rail network collapsed within a month of being
Padbury, a small explorer, surprised markets on April 11
when it said it had lined up more than $6 billion in funding
from unnamed investors to build an iron ore port and rail line
in Western Australia, a project that had been stuck on the
drawing board for two decades.
Padbury's announcement triggered a spike in its shares and
the Australian Securities Exchange slammed a halt on trading
until the company provided more details on the deal.
After several delays, Padbury said the funding agreement
with little known Alliance Super Holdings Pty Ltd and Superkite
Pty Ltd had been scrapped, without giving a reason. Alliance
Super and Superkite are controlled by Roland Bleyer, a financier
and former hair clinic operator.
In response to a long series of questions from ASX, Padbury
said on Friday it had left out key conditions on the deal in its
initial announcement because it believed it would be able to
meet those conditions by the time the deal closed.
It also declined to say whether its directors had signed off
on the initial announcement that went to the market, saying ASX
did not have the authority to ask that question.
ASX could not comment on whether there were grounds to refer
Padbury to the Australian Securities and Investments Commission
(ASIC), the watchdog that would have power to investigate any
potential breach of continuous disclosure, false and misleading
statements or insider trading.
"Without commenting on any specific case, ASX is required to
refer matters to ASIC if we suspect that a significant
contravention of our rules or the Corporations Act has
occurred," said ASX spokesman Matthew Gibbs.
An ASIC spokeswoman had no immediate comment on whether
Padbury was being investigated further.
By 0207 GMT, shares in Padbury were down 85 percent at
A$0.005 after touching a four-and-a-half month low of A$0.004,
valuing the firm at A$16.9 million ($15.7 million).
(Reporting by Sonali Paul and Thuy Ong; Editing by Stephen
Coates and Joseph Radford)