NZF Money heads into receivership owing about $18m
NZF Group subsidiary NZF Money is heading into receivership owing investors about $18 million.
Friday, 22 July 2011
by Jenny Ruth
NZF told the stock exchange the subsidiary's board have "explored various options for a short-term funding solution. After giving the matter considerable thought and taking into consideration developments over the last couple of days, the board of (NZF Money) do not believe that such a short-term solution is in the best interests of (NZF Money) or its investors," the company said.
Accordingly, NZF Money's board has asked its trustee, Covenant Trustee Company, to appoint a receiver.
Yesterday, it was revealed the Financial Markets Authority had forced the withdrawal of NZF Money's prospectus last Monday. Also yesterday, international ratings agency Standard & Poor's cut NZF Money's rating to "CC" from "CCC-" and warned it was likely to default next week unless NZF money was able to inject new funds into the business.
NZF made no mention of the unnamed Australian private company which is supposed to be taking a majority stake in NZF's home loan division. In June, NZF said this party was in the final stages of due diligence.
NZF Money's latest prospectus showed it had $18 million in secured debenture stock at June 24.
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