Sharechat Logo

Capital + Merchant debenture holders to get 2nd payment in March

Tuesday 7th February 2017

Text too small?

Some 7,500 investors left out of pocket by Capital + Merchant Finance will get their second payment next month, almost a decade after the lender collapsed. 

Receiver Brendon Gibson of KordaMentha told investors a second distribution of $2 million will be made next month, taking the total returned so far to $12 million, or 7.2 cents in the dollar, in his latest report. A third payment is expected to be made once the receiver's final claim is completed, although a potential rival has emerged for that money which Gibson said the receivers are investigating. 

A $94 million claim backed by Australian litigation funders Litigation Lending Services for damages against Capital + Merchant's former trustee, Perpetual Trust, and law firm Stace Hammond was settled out of court last year, and while the latest report said the terms of the deals were confidential it shows the receiver recouped some $4.6 million from legal claims. 

Before those settlements, the receivers got $10.3 million from the $18.5 million settlement between Capital + Merchant's liquidator and the company's audit firm BDO Spicers. 

The Capital + Merchant receivership is one of the more protracted, with another set of managers, Richard Simpson and Tim Downes of Grant Thornton, acting in the interests of the first-ranking creditor Fortress Credit Corp controlling the administration until their retirement in 2012. In their final report, Simpson and Downes said the only recoveries they anticipated for debenture holders would be through legal claims. 

Former Serious Fraud Office boss Adam Feeley has described the collapse of Capital + Merchant as being as bad as anything that occurred in the industry, because nothing had been recovered for investors. Former Capital + Merchant directors Wayne Douglas and Neal Nicholls and chief executive Owen Tallentire were jailed for fraud in 2012 for what the Court of Appeal later called “theft on a grand scale”.

BusinessDesk.co.nz

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

MARKET CLOSE: NZ shares up, led by Fisher & Paykel Healthcare, Ryman
NZ dollar heads for 0.1% weekly fall with jittery markets over weaker yuan
Xero quits developing in-house US payroll product, signs up with Gusto
Farming, horticultural groups seek flexibility in zero emissions plans
Hawaiki Submarine Cable begins commercial operations
Net migration falls in June, remains historically high, Stats NZ says
Commerce Commission files proceedings against Wilson Parking, seeks penalty
SeaDragon's funding transaction unfair but positives outweigh negatives, say independent advisers
Morningstar cuts earnings forecast for Z Energy but maintains hold rating
July 20th Morning Report

IRG See IRG research reports