Force set to lose it’s Firepower


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The controversial fuel technology company Firepower appears on the verge of collapse, with its offices abandoned in Perth and other parts of the world, and the company owing millions of dollars to rugby union players, the Western Force club, basketballers and other creditors.

Several Western Force rugby union players, including their highest-paid player, Matt Giteau, are reconsidering their contracts with the Perth-based Super-14 franchise after not being paid by Firepower this year reports RugbyHeaven.

The club, too, is still owed hundreds of thousands of dollars for its Firepower jersey sponsorship.

Western Force’s chief executive, Greg Harris, told the Herald that if the Firepower money was not paid it “would have a significant effect on the financial bottom line of the franchise but would not cause major distress”.

The Herald understands the money owed to the Western Force and its players tallies well into several million dollars. This comes as another Firepower-related entity, the Sydney Kings basketball team, yesterday made outstanding contract payments to the former Kings captain Jason Smith. It faced a tight deadline of having its licence revoked by the National Basketball League.

The Sydney Kings owner, Tim Johnston, is the chairman of Firepower, which is also the main sponsor of the Kings.

But most of this month’s basketball player payments, due on May 16, have still not been paid.

The Australian Taxation Office is currently investigating delayed superannuation payments to players. Giteau could be owed more than $500,000.

Mr Harris said he was facilitating urgent negotiations to recover and replace some of the Firepower money to keep faith with the Force players.

“At the moment some players are in discussions with various parties to ensure that if there are any shortcomings from Firepower obligations they are as best fulfilled as possible,” he said.

A substantial proportion of Giteau’s three-year $4.5 million contract is tied up in Firepower payments, while most of the other Firepower-linked players, including potential Wallaby squad members Drew Mitchell, Ryan Cross and Cameron Shepherd are owed more than $100,000 each. Scott Staniforth is also owed money but another Firepower-linked player, Scott Fava, had his Firepower sponsorship withdrawn in the fallout from the quokka controversy just before Christmas.

Giteau’s manager, Chris Orr, said he had written to Firepower asking for clarification.

“As of last year he was paid his entire sponsorship amount, but going forward if the money is not paid we will have to look at Matt’s personal situation,” Mr Orr said. Giteau is signed to the Force until 2009.

It is understood none of the rugby union players has been paid any Firepower instalments in 2008.

The last Firepower money was paid in December 2007.

Mr Harris said he was negotiating for a new sponsor, but he was still hopeful that Firepower, or a related entity of the company, would come forward with a satisfactory resolution.

It appears that Firepower has closed or scaled back its offices in South Africa, Russia and Britain, as well as deserting its Perth headquarters.

The Herald put 13 questions in writing to Firepower’s spokesman, Michael Zahn, yesterday. He said in an email: “Firepower executives have declined the chance to respond to these questions at this time.”

The Firepower saga, which also involved a short-lived one-year sponsorship of the South Sydney Rabbitohs before Russell Crowe and Peter Holmes a Court terminated the deal, goes back to early 2006.

In that time Mr Johnston turned the biggest sporting codes in Australia into his own personal public relations machine, transforming himself from obscurity into the brightest star on the business scene.

He convinced everyone from the former prime minister, John Howard, to the former Queensland premier, Peter Beattie, to listen to claims he had helped develop fuel technology that included a pill to improve vehicle efficiency and reduce pollution.

Mr Johnston said he had multi-million-dollar contracts for his products in Russia, Indonesia, Pakistan and countries associated with the former Soviet Union.

Firepower benefited from enthusiastic federal government support, getting almost $400,000 in taxpayer grants from Austrade. But some of the Firepower-related entities Austrade dealt with and helped promote did not exist.

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