Ruapehu Alpine Lifts first liquidators’ report: What happens next?

Whakapapa's Happy Valley opened in time for the early July school holidays. Photo / RAL webcams

The first liquidators’ report on the company behind New Zealand’s biggest commercial skifields says the best option is to continue running the fields this season while hunting for buyers - but a sale for under the $53 million asset value is possible.

Ruapehu Alpine Lifts’ liquidators Richard Nacey and John Fisk of PwC have also released a list of secured creditors.

“The liquidators are of the view that the best outcome for creditors is likely to be the sale of the business and assets of the company as a going concern,” the PwC accountants wrote.

“As such, the liquidators are continuing to trade the business through the 2023 winter ski season, while a sale of the business and assets is sought. The liquidators have also secured funding of $5m from the Crown to trade for the 2023 winter season.”

The business operates the Whakapapa and Tūroa ski areas on Mt Ruapehu, New Zealand’s two largest commercial ski fields, owning the assets of the areas and having licences from the Department of Conservation as well as relationship agreements with the local iwi.

Buyers might offer less than $53m.

“The company has fixed assets with a book value of $53m as at October 11, 2022. Given the nature of these assets and their location on Mt Ruapehu, the expected break-up sale value of these assets is significantly lower than this figure. The company had accounts receivable of $227k as at our appointment,” the liquidators said.

Businesses and entities with securities over the company include ANZ Bank, Steel & Tube Holdings, Allied Petroleum, BOC, Lion NZ, Fletcher Distribution, H J Asmuss & Co, Hynds Pips Systems, Windcave New Zealand, Māori Investments, Taupō District Council, Tūwharetoa Gondola Partnership, Brittain Wynyard & Co, AFL Telecommunications Australia, The Merchant of Taupō, Active Electrical Supplies, Crown Regional Holdings, Cirtex Industries, Stoney Creek and De Lage Landen.

But those parties aren’t demanding action or money right now.

“The liquidators have not received indications from any secured creditors that they intend to enforce their security. The liquidators will continue to work with secured creditors while attempting to realise a sale of the company’s assets,” the report said.

Inland Revenue has provided proof of debt with a potential preferential claim for $29,000 in outstanding GST, but that differed from the company’s records, according to the liquidators, who are investigating that aspect further.

Around 15,043 unsecured creditors are owed $44.6m. Those are mainly the lifetime pass-holders whose names are also listed in this first report.

Last month, the company was put into liquidation via an order made in the High Court at Auckland before Justice Christine Grice.

That hearing came after a watershed meeting where major creditors, including the Government, ski pass owners and the ANZ Bank, voted on one of three options presented to salvage the commercial operations of the fields.

For an option to go through, 50 per cent of creditors needed to vote in agreement by number, but 75 per cent by the value of their debts.

Last October, Ruapehu Alpine Lifts went into voluntary administration owing more than $40m, after being hit by poor seasonal conditions and pandemic closures during the past few years.

The creditors were presented with options by administrators Fisk and Nacey of PwC, with the preferred option, to sell both Ruapehu fields for $1 to bidders Whakapapa Holdings, financed by private equity group the South Island Office, and Pure Tūroa, backed by developers Cam Robertson and Greg Hickman.

That option didn’t hit the required baseline, reaching 44.2 per cent by number but 93.2 per cent by dollar value.

Bell Gully’s David Friar, acting for the company, told the court it was rare for a company to apply to the court to liquidate itself.

But given the result of the meeting, liquidation was the most responsible option for the directors.

That was because the company was “hopelessly insolvent” and “had no money to pay its debts”, Friar said.

Administrators Fisk and Nacey were then appointed liquidators.

The Companies Office posted their first report overnight.

Anne Gibson has been the Herald’s property editor for 23 years, has won many awards, written books and covered property extensively here and overseas.