Receivers see shortfall for Strategic Finance debenture investors; nothing for preference shareholders

PricewaterhouseCoopers, which is acting as the receiver for Strategic Finance, said debenture investors in the property financier were unlikely to receive all their money back, while preference shareholders would receive nothing back. PwC made the comments when notifying the NZX that they had applied to delist Strategic Finance from the NZX. "Having regard to the extent of SFL’s creditors, and the receivers’ assessment to date of likely recoveries, the receivers anticipate there will be a shortfall in the amount available for creditors, and no amount available for SFL’s preference shareholders," it said. The property financier that includes former All Black captain Jock Hobbs among its directors owes NZ$417 million to 13,000 investors. This makes it the second biggest finance company receivership after Bridgecorp collapsed in July 2007 owing NZ$458.7 million to 18,000 investors. It is one of 48 finance companies or investment funds to have collapsed, been liquidated, gone into receivership or to have been put into moratorium since May 2006. Collectively they owe investors around NZ$6.2 billion in 187,000 accounts. See more in this Finance Company deep freeze list here. Strategic Finance stopped making interest payments and stopped lending in August 2008, before convincing investors in December 2008 to agree a moratorium delaying repayment for five years rather than immediate receivership. However, it missed its first repayment due on January 7th this year and declared fresh losses of NZ$107 million on property loans it couldn’t refinance. The default on the payment and a slump in loan values below 75% of liabilities gave Perpetual the right to put it into receivership at that stage.