Hubbard's Southbury debts include nearly $190m owed SCF
Allan Hubbard's Southbury Group and subsidiary Southbury Corporation probably owe much more than they're worth, including nearly $190 million to 100%-owned South Canterbury Finance (SCF)
Wednesday, 6 July 2011
Second reports on both companies by receivers Kerryn Downey and William Black of accountancy firm McGrathNicol also suggest the two companies'
activities may be caught up in legal action involving SCF.
"We are aware of a number of concerns raised by investors and other parties with respect to certain transactions" among Southbury Group, Southbury Corporation and SCF before the receivers were appointed.
"Potential breaches of legislation that are identified during the course of the receivership will be reported to the relevant regulatory authorities," both reports says.
"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.
The reports show Southbury Group had $7.1 million in net assets on November 3 last year, the date the two companies went into receivership after failing to repay loans owed SCF.
However, Southbury Group's assets included a $20.9 million "capital contribution" to SCF and $160.6 million worth of shares in subsidiary Southbury Corporation.
Southbury Corporation's major assets are its 100% shareholding in SCF and an $18.1 million loan, as at November 3 last year, which Southbury Group owes it.
The reports show the corporation owes SCF $103.9 million while the group owes SCF $84.7 million.
They also show SCF advanced $160,000 to Southbury Group to finance the Southbury receivers' activities - Downey and Black are also the SCF receivers.
Southbury Group's receivers' fees amount to $131,440 while the corporation's receivers' fees total $57,270. In addition, legal fees for the group total $50,652 and, for the corporation, $5,008.
The Southbury Group report says the receivers "omitted from this report out realisation estimates of the assets as we believe that their inclusion could materially prejudice the exercise of our functions, and in particular, our duty to obtain the best price reasonably obtainable for the company's assets."
The Southbury Group balance sheet shows other assets include $5.5 million in shares, at cost, in Biogene Holdings, and a further $5.1 million in other unspecified shares at cost.
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