Wirecard NZ - the fully-owned subsidiary of the scandal-plagued German payments group - has today been placed in voluntary administration.
McGrathNicol partner Andrew Grenfell, who has been appointed voluntary administrator, told the Herald, "It's business as usual", for around 20 Auckland-based staff.
He hoped to find a buyer.
Overnight, BDO partners Andrew Fielding and Nicholas Martin were appointed administrators of Wirecard Australia, whose clients include Westpac Australia.
Grenfell said he was working with his opposite numbers across the Tasman, and a sale of both businesses was possible.
It was also possible that Wirecard NZ could be sold standalone.
Grenfell said Wirecard NZ was set up differently from the rest of the group. It is a software licensing business and development business, not transactional. It was possible it could be sold separately.
"It's a good business," Grenfell said. Unlike its German parent, it was not under investigation.
Voluntary administration was necessary because Wirecard NZ had been historically been financially reliant on its parent to cover on-going liabilities incurred on behalf of the wider Wirecard group of companies, Grenfell said. Wirecard's ultimate holding company, in Germany Wirecard AG, filed for insolvency on June 26.
Wirecard has three entities in Australasia. Wirecard NZ; Wirecard NZ's subsidiary Wirecard Australia Pty (also in administration); and Wirecard Australia Acquiring & Issuing Pty Ltd (which is not in administration).
Wirecard's founder Markus Braun was arrested last month on suspicion of false accounting and market manipulation, two days after the payments group admitted €1.9 billion ($3.32b) of cash reported on its balance sheet likely never existed.
The group's shares have collapsed from €140.90 to €2.44 since the revelation and later statements that previous financial statements might be inaccurate.
Wirecard NZ losses
Wirecard NZ has yet to make public its financial statements for the December 2019 year but did file its 2018 accounts to the Companies Office in March this year.
Those statements showed the firm made a loss of $8 million in 2018, worse than the $1.2m loss reported the previous year.
The accounts stated that Wirecard NZ was dependent on continued support from its parent company – including a €10m letter of support for five years beginning April 2019.
A note under the heading "subsequent events" highlighted a court dispute with an Australian company that it was defending and a recapitalisation event in December 2019, whereby the German group increased the New Zealand company's share capital by €7.51m.
Wirecard NZ used this to settle "all outstanding loans" with Wirecard Technologies GmbH, the note said.
Since then, the New Zealand firm has borrowed an additional $1.85m from its parent company.
Wirecard's New Zealand accounts showed it paid wages and salaries of $8.6m in 2018.
The firm does not appear to have received support under the Government's Covid-19 wage subsidy scheme, based on a search of the Ministry of Social Development's web page.
Efforts to contact Wirecard NZ's director and vice-president of finance and administration, John Nicholson, led the Herald to the company's global public affairs team, who did not respond to questions about the New Zealand subsidiary.
Wirecard's Asia headquarters last year were raided by Singapore police after the Financial Times reported whistleblower allegations that staff in the city-state had forged documents to deceive regulators and auditors. Police investigations there are ongoing, the FT reported this week.
Last year, the Herald reported two of Wirecard's NZ directors – Andreas Kazamias, from Cyprus, and Arne Matthias, of Singapore – resigned on February 28, 2019.
Wirecard NZ's remaining three directors are Singapore-based Jeffry Ho and Fook Sun Ng, and Nicholson.
Wirecard was founded in the late 1990s and expanded through acquisitions, initially in Eastern Europe and then in Asia.
It established a foothold in Australia and New Zealand by buying Auckland-based payment company GFG Group in 2014.