KEY POINTS:
As investors continue to endure lengthy waits for information on when they might get their money back, the trustee for a number of stricken finance companies says she is becoming frustrated with delays to repayment plans.
In the past three months a number of finance companies, in a
bid to stave off receivership, have frozen repayments totalling $1.5 billion, promising investors they would present recapitalisation or repayment plans within a few weeks.
Last month Dorchester Pacific Group said it aimed to finalise its survival plan by the middle of this month and put it to a vote by the end of August or early September.
Yesterday Dorchester's trustee, Louise Edwards of Perpetual Trust, said she was promised an up-to-date plan from Dorchester by Friday last week but it still had not arrived.
"The delays that we're experiencing are certainly frustrating to us and I'm sure are frustrating to investors. However we are in close communication and do expect that plan to arrive in the next day or two.
"It's a bit of a balancing act; we want to make sure the plan is robust in all cases and to make sure we get the best outcome."
Wellington-based St Laurence Finance, 25 per cent owned by Dorchester, ceased lending and raising money from the public in June and has yet to put its plans for a "scheme of repayment" to investors.
The Herald understands the company will update investors in the next week or so. The company expects to send details of the plan to investors by the third week of September, with a vote in October.
Edwards last week rejected a capitalisation proposal from Dominion Finance, which is now working on a plan for an "orderly realisation" of its assets. The highest profile firm to seek approval for a rejigged repayment plan from its trustee and investors is Mark Hotchin and Eric Watson's Hanover Finance.
In a letter to investors chairman Greg Muir said the company's restructuring plan, which would see Hotchin and Watson provide "tens of millions" in additional capital, should be completed by the end of the month.
Investors in Strategic Finance are waiting for a consortium comprising management, the company's directors and founders and its major financier Bank of Scotland International to complete talks on a proposal to buy the company back off owners Allco HIT.
The consortium's original proposal was scotched by BOS International when the bank got cold feet over the deteriorating property market. If negotiations are successful, debenture investors will vote on a proposal under which they will receive 30 per cent of their principal in three equal instalments over 18 months starting in March next year with the balance of their cash converted into bonds.
IN LIMBO
Hanover: Owes $554 million to 16,500 investors and says it will reveal a recapitalisation plan at the end of this month.
Dominion Finance: Owes $276 million to 13,000 investors. Its recapitalisation plan was last week rejected by its trustees and it is now working on a plan for an "orderly realisation of assets".
Strategic Finance: Owes 15,000 debenture investors $325 million. Has outlined a delayed repayment plan as part of an ownership change proposal. Negotiations with owners are continuing.
St Laurence: Owes $250 million to 9000 debenture and capital note holders. Is still working on its "scheme of repayment" which it hopes will be with investors in late September for a mid-October vote.
Dorchester Pacific: Owes $168 million to 9000 debenture investors and $8 million to subordinated note-holders. Its plan to defer repayment of principal over two years while still paying interest is expected to go to its trustee this week.
