Wednesday 8th August 2007
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They have also reconfirmed that they believe fraud took place and legal action is being pursued.
"Our investigations have uncovered evidence of a series of alleged frauds committed against Provincial," recievers John Waller and Maurice Noone say.
Legal proceedings have been started against credit reporting agency Baycorp and other parties as well as other legal steps to freeze assets of those other parties.
They warn investors that a successful outcome to these proceeding will not materially change the outcome for investors.
The third key development is the future of the business there are a number of options including an orderly wind-down of the business, a restructure of the companies or an outright sale.
In their report for the period to June 30 they say "we are in discussions with a party with respect to the restructure of the companies. In addition we continue to be in regular contact with several parties who have expressed an interest in an outright purchase of the business."
It is understood that former Provincial chief executive and shareholder John Edilson is working on a restructuring plan. Currently the receivers have paid 57.5c in the dollar to investors in four interim distributions. This has primarily been funded from collection of the finance receivables book.
The receivers say the frequency and size of future dividends will diminish as the receivership continues. They also point out that loan repayments are happening more quickly than expected and that means there will be less interest income to distribute over time.
That book stands at $175.7 million at June 30 and the provision for bad debts is $75.0 million. Borrowings (money from investors) sits at $125.84 million.
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