Strategic suspends redemptions
Strategic Finance, whose managers and directors are seeking to buy out the firm, today suspended redemptions of debentures and notes citing dwindling liquidity.
Thursday, August 7th 2008, 6:18PM
by Jonathan Underhill
"While negotiations have been continuing there has been a further material decline in the property finance market sector and reinvestment rates," chief executive Kerry Finnigan said in a statement.Managers led by Finnigan teamed up with Halifax Bank of Scotland unit BOS International to acquire the company, gaining support from BOS for a NZ$150 million wholesale lending facility that would reduce its need for debenture funds. Those talks may result in a capital restructure as well as a change of ownership, the company said today.
The proposal is subject to approval by shareholders of Allco HIT Ltd., which is selling Strategic Finance's immediately parent. Strategic's current owners are "unable to assist in providing the necessary capital we need to run the business and move forward," Finnigan told BusinessWire last month.
The company had assets of NZ$568 million at June 30, with debentures at NZ$320 million. Strategic's 10.52% perpetual preference shares trade on the NZX debt market.
From today the company also has stopped accepting subscriptions for debentures and subordinated notes, it said.
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