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It's the $1 club

By Jock Anderson

Friday 8th September 2000

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TAINUI TURNOVER: Warriors stiff-armed
A $1 sleight of hand by Tainui to divert the Warriors rugby league club from a possible liquidation sale has been uncovered.

Literally hours before the High Court appointed a liquidator over MDC Investment Holdings - the Tainui-owned parent of the Warriors - a $6.27 million debenture over the league club was assigned from MDC Investment Holdings to its parent, Tainui Group Holdings, for $1.

The assignment of the debenture was made without reference to, or the knowledge of, Graham Lowe and Malcolm Boyle who own a third of the Warriors.

Mr Boyle said he and Mr Lowe did not even know there was a debenture registered over the Warriors.

Mr Boyle and Mr Lowe were ousted from the Warriors board earlier this year when Tainui placed tribal financial affairs in the hands of corporate undertaker Michael Stiassny of Ferrier Hodgson.

Liquidator Anthony McCullagh, acting for ASB Bank, which is owed nearly $1 million by MDC Investment Holdings, described the move as "morally repugnant" and a blatant bid to deprive access to a saleable asset.

Late yesterday Messrs Boyle and Lowe invoked a shareholders' agreement and offered to buy MDC Investment Holdings' two-third stake in Rugby League People, the company that owns the Warriors, for $1.

Their offer and moves to overturn the assignment of the debenture were under consideration at press time.

The assignment was discovered as Mr McCullagh began searching for assets of MDC Investment Holdings - Tainui's high-risk but insolvent investment arm which effectively shut up shop last December.

It is understood it owes its Tainui Group Holdings parent between $18 million and $20 million.

MDC Investment Holdings owned or controlled at least 15 subsidiary companies.

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