Hamish Fletcher

Business reporter for the NZ Herald

Strategic investors get first settlement payout

Kerry Finnigan, former head of Stragetic Finance.  Photo / Supplied
Kerry Finnigan, former head of Stragetic Finance. Photo / Supplied

Some Strategic Finance investors - who were owed $360 million when the company collapsed - are to get their first payment from a $22 million settlement in the next fortnight.

Strategic Finance directors and its auditors, BDO Spicers, are to pay $22 million after reaching a settlement with the Financial Markets Authority and the failed firm's receivers.

Under the settlement announced in June, another 5c in the dollar will be paid to the finance company's secured investors, who were owed more than $360 million when the company went into receivership.

The settlement means the total amount returned to secured investors by the end of the year will amount to 15c in the dollar.

In an update today, the receivers from PwC said the settlement agreement went conditional last week and a first payment of $10 million had been received.

"This will enable a distribution to secured investors to be made within the next two weeks...there are two further instalments of $6 million due at the end of August and November 2014 which will enable further distributions to be made," the receivers said.

The FMA in June defended its decision to not disclose who out of Strategic's directors and auditors were paying what in the settlement.

The six former Strategic directors in the settlement - Kerry Finnigan, Graham Edward Jackson, Marcel Aubrey Lindale, Timothy John Rich, Denis Grenville Thom and David John Wolfenden - have undertaken not to act as directors or promoter of a public issuer of securities for five years or as chief executives or chief financial officers for three years.

Last year, the FMA said it believed the directors were likely to have breached disclosure obligations under the Securities Act by making false statements.

- NZ Herald

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