Padbury shares slumped 85% – which was more than they had gained in the lead up to and day of the April 11 announcement of a proposed $US6.4 billion ($A6.9 billion) funding deal for the Oakajee port and rail project from a mystery investor.

Shares in the company had been suspended since then and following the 10-page response to a lengthy query from the Australian Securities Exchange, were reinstated this morning.

It comes after Padbury announced late Wednesday that the funding deal with Roland Frank Bleyer’s Alliance Super Holdings and Superkite had been terminated.

Padbury told the ASX this morning that the termination meant that the contents of the original announcement were no longer material to the company’s share price.

The company revealed it had been in discussions with ASH and Superkite for 18 months.

“During that time Padbury sought information from ASH and Superkite in relation to their capacity to fund ASH's share of the costs relating to the development of the Oakajee project and ASH represented to Padbury that the group of companies, of which ASH is a part, had access to sufficient capital to allow ASH (through Superkite) to fund its share of the costs relating to the development of the Oakajee project,” Padbury told the ASX.

The ASX also questioned Padbury’s claims that the deal would be non-dilutionary to shareholders and its claims of negotiations with the Western Australian government.

It comes after WA Premier Colin Barnett was reported as saying there had been no contact with Padbury.

Padbury maintained it had met with Barnett’s staff and the Department of State Development over the past 12 months.

For the first time, Padbury revealed that the conditions of the shareholder agreement were the procurement of a bank-issued demand guarantee to Superkite for $94 million, as well as shareholder approvals, which needed to be satisfied within 40 days.

Padbury said the conditions weren’t disclosed because it thought it could satisfy them.

“However, the ‘Oakajee Funding Secured’ announcement was not reviewed by external legal counsel,” the company said.

Padbury said it was concerned by the matters raised in the ASX query.

“Padbury will implement an external law firm review of its corporate governance policies and ASX disclosure and listing rule compliance processes, and a training and assessment program for Padbury's officers and staff,” the company said.

“The objective will be to ensure Padbury fully complies with its obligations under the ASX listing rules and sets a high standard in corporate governance.”

When asked by the ASX if the original announcement was approved by directors as a material disclosure in accordance with the company's corporate governance statement and the market's disclosure policy, Padbury was less forthcoming.

Padbury said "a response to your question might tend to deny the directors the statutory protections with respect to self-incrimination that would be available in the context of an ASIC investigation".

Padbury shares rose as much as 165% to a high of A5.2c on April 11 but today slumped 85% to just 0.5c – after dropping as low as 0.4c.