GENERAL: ALF: Successful Court Judgment / Allied Nationwide Finance Value

14 Jun 2010 1:22 pm

ALF 14/06/2010 GENERAL

REL: 1322 HRS Allied Farmers Limited

GENERAL: ALF: Successful Court Judgment / Allied Nationwide Finance Value

Allied Farmers Limited today announced that it has received confirmation that it has been awarded more than $6 million after a long running legal dispute with Pacific Northstar Property Group, headed by well known property developer Mark Cooper.

The award relates to a luxury development in Beverley Hills, California, known as the Reeves Maison Condominiums, which were financed in part by Hanover. The judgment, entered by a California court, granted the receiver permission to make an interim distribution of more than $6 million plus interest, currently held in trust. In addition, the receiver currently also holds other funds of $3.5 million in trust, which is forecast to increase to between $11.5 million and $13.5 million as the remaining condominiums are sold. Whilst there remain objectors to the distribution of the remaining funds, given the success in this judgment and the difficult position it creates for these objectors, the company is confident of further distributions in due course.

Allied Farmers Managing Director, Rob Alloway said "This is a pleasing outcome for which we have been waiting some considerable time. Our US based legal counsel, Miller Barondess, have done an excellent job defending the claims made by Pacific Northstar and its associates".

In addition, Allied Farmers Limited also announced it is currently performing an annual detailed review of the carrying value of its investment in its finance subsidiary, Allied Nationwide Finance Limited. The carrying value will be supported by an independent valuation.

"Given the recent asset impairments, followed by a credit rating downgrade, and issues surrounding the finance sector in general, we envisage a further write down will be necessary against the carrying value of Allied Nationwide in our full year accounts" said Alloway.

For further information please contact:

Rob Alloway Managing Director Phone 021 376642 Email rob.alloway@alliedfarmers.co.nz End CA:00196066 For:ALF Type:GENERAL Time:2010-06-14:13:22:30

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