Perpetual sends St Laurence to the receivers, slaps down Podmore

Thursday 29th April 2010

Perpetual Trust has sent St Laurence into receivership a day after the finance company's managing director Kevin Podmore pitched an offer to debenture holders to swap their debt for equity in a new holding company.

Perpetual head of corporate trust Matthew Lancaster said "the letter to investors that St Laurence released yesterday was without the required authorisation of the trustee" and that Podmore had been "expressly" told that it should not be sent.

"There were a number of reasons for this, principally that the information contained in it was selective, and potentially misleading as a result," Lancaster said in a statement.

"Under the debt for equity swap which relocated investors into a new company, the existing management would have remained in place and in that and other respects, St Laurence's proposal provided no certainty that the very disappointing performance of the company in the recent past would improve."

St Laurence gave investors an ultimatum, saying it was on the brink of insolvency and that they could choose to either swap their debentures for shares in a shell company that would own the assets, or send the company to the receivers.

Perpetual's Lancaster was scathing of the offer to investors, saying the company had not been open in the manner in which it acted, and that it was not able to provide the McGrath Nicol report it had commissioned, nor any report from Grant Samuel, despite the public references.

"This is a very clear case where the interests of stockholders will be served by removing the current directors and management from the process of recovering monies for investors," he said.

Barry Jordan and David Vance of Deloitte were appointed to act as receivers, and Lancaster said he will ensure the "guarantees provided by the corporate guarantors and Mr Podmore remain in place rather than being released as they would have been under St Laurence's proposal."

He said he has also ensured that National Property Trust and Irongate Property have been kept out of receivership. St Laurence has paid back $10 million to investors since it went into moratorium in December 2008, owing some 9,000 people $245 million.

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