Hubbard's Southbury companies unlikely to repay more than $186m

Allan Hubbard's Southbury Group and Southbury Corporation are unlikely to be able to repay the more than $186 million plus interest they owe South Canterbury Finance (SCF), the latest receivers' report says.

Thursday, 22 December 2011

by Jenny Ruth

Southbury Group has repaid just $2.3 million of the $84.7 million it owed SCF on November 3, 2010 and receivers Kerryn Downey and William Black of accountancy firm McGrathNicol say its remaining assets and loans "are assessed as having negligible value."

That's because a number of companies Southbury Group held shares in or lent money to are either inactive, insolvent or in receivership, they say.

Southbury Group's major asset is 100% of Southbury Corporation which owed SCF $103.9 million on November 3, the date the receivers were appointed to both companies.

Southbury Corporation's major assets are an $18.1 million (as at November 3, 2010) loan to Southbury Group and its 100% shareholding in SCF and it hasn't been able to repay SCF anything.

"We do not expect that there will be sufficient funds generated from either SCF or Southbury Group's realiseable assets to enable a return to be paid" to Southbury Corporation, the receivers say.

The receivers' third report is even bleaker than their second which had indicated a Southbury Group had also owned shares for which it had paid about $10.6 million.

Southbury Group's receivers' fees amounted to $62,386 between May 3 and November 2 and Southbury Corporation's were $7,6,95. In the previous six months the group's receivers' fees were

$131,440 while the corporation's receivers' fees totalled $57,270.

The receivers say potential breaches of legislation identified will be reported to the relevant regulatory authorities and that both the Southbury companies may have been parties to some transactions causing concern.

"Due to the ongoing nature of the investigations, we are unable to provide details regarding individual issues or our findings since doing so could prejudice any subsequent proceedings which may be taken," they say.

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