eHome now in liquidation as sale efforts fail

Houses by eHome in the Waimahia Inlet in Weymouth, Auckland. Photo / Nick Reed

Landlord buys many of firm’s assets but unsecured creditors given little hope.

One of New Zealand's biggest off-site housing manufacturers is now in liquidation as well as receivership and many of its assets have been sold to its Auckland landlord, say the receivers.

Stephen Tietjens was appointed eHome's liquidator after the company's February receivership.

Reports filed with the Companies Office show unsecured creditors of the Kumeu-based business are owed $5.1 million with little hope of getting paid and a long creditors' list has been released, spanning many different sectors.

Tony Maginness and Peri Finnigan, eHome's receivers from McDonald Vague, updated information about the asset sale.

"We sold the assets to Soft Technology JR, a company associated with the landlord," Maginness said.

"They have retained some of the eHome staff with the intention to manufacture houses. We have also negotiated a deal to sell most of the stock which will go towards repaying the preferential creditors' claims - this transaction is not yet concluded."

The company had $14 million of secured creditors "so getting a return for unsecured creditors was always unlikely", Maginness said.

More than 40 overseas and local businesses considered buying the prefabricator, which was supplying many Housing NZ houses throughout Auckland when its owners put it into receivership. "Six parties ... came very close to going unconditional but their due diligence identified a number of issues that ultimately stopped them making an offer," he said.

"The most common reasons we didn't sell the business as a going concern were large losses leading up to receivership, we couldn't see the business as ever being very profitable because of the overheads, it was difficult to establish the true margin because most houses were different and there were concerns about through-put if there is a downturn in the property market.

"It was considered a hard business to manage. It was a new way of doing things which wasn't fully accepted by the market," Maginness said.

"I think at the end of the day the market still wants bespoke houses and is not ready for mass-produced replica homes.

"It is unfortunate because that would help solve the affordable housing issue in Auckland."

Companies Office records show eHome's name has now been changed to Ex-ZNHE.

eHome creditors

Secured:
• CIM eHome: $7.8 million
• ANZ Bank NZ: $4.5 million
• Ngatotara Trust: $1.7 million

Unsecured:
• Owed $5,109,435
[Source: McDonald Vague receivers' report]