Strategic investors about to get first payment
Strategic Finance is gearing up to make its first payment to debenture holders under its moratorium agreement, and expects this to go through over the Christmas-New Year's period.
Tuesday, December 1st 2009, 9:30PM
by Paul McBeth
Chief executive Kerry Finnigan said the finance company has asked its secured debenture holders to confirm their bank details so it can prepare to make its first payment under the terms of its moratorium agreement by the end of the year.
He is more upbeat about the state of the market compared to his September letter to investors, which reaffirmed the deteriorating picture of the property market, saying "property values are stabilising and are showing signs of recovery after a tough six to 12 months."
"We got hammered by the IFRS requirement, which will reverse over time," he said
After 12 months in moratorium, Finnigan says Strategic is in the same boat as everyone else as things slowly recuperate: "The reason we went into a moratorium is that we don't want to sell in a distressed state at prices below fair market value."
The finance company froze repayments to 15,000 investors owed some $325 million in August last year, before a majority of investors voted in favour of the moratorium in December.
Strategic has not changed its outlook on repayments yet, under which debenture stockholders will receive between 85 cents and 93 cents in the dollar over a five-year period.
Paul is a staff writer for Good Returns based in Wellington.
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