Pyne Gould sues Andrew Barnes, Bath Street for at least $22M over Perpetual sale

Wednesday 30th September 2015

Pyne Gould Corp, which today blamed its auditor for the late filing of its annual report, is suing Bath Street Capital and Andrew Barnes for at least $22 million that it claims is an unpaid bill from the sale of Perpetual Trust.

In a statement released after the close of trading, Guernsey-based Pyne Gould said it commenced proceedings in the High Court in Auckland yesterday, seeking damages of not less than $22 million, with interest and costs. Pyne Gould made the demand on Bath Street in May over what it said it's owed from the sale of Perpetual, which "represents unpaid consideration in respect of carrying rights pursuant to the share sale agreement as subsequently varied."

Bath Street rejected the demand, saying at the time that the agreement was for Pyne Gould to be paid if the shares of a subsidiary company were listed on the stock market, something that hasn't happened. Bath Street has said it will "robustly defend the matter" and, if it goes to court, will require Pyne Gould principal George Kerr and other associates of the firm to give evidence.

The transaction attracted the attention of the Financial Markets Authority after Pyne Gould recognised the $22 million gain in its 2014 annual earnings on the sale of Perpetual, despite the payment not being triggered. Pyne Gould later said it would reclassify the amount as an "available for sale financial asset" in its first-half accounts, and its the 2015 annual statements showed a one-time gain of 11.3 million pounds on the sale of discontinued operations in 2014.

Pyne Gould shares last traded at 24 cents, and have dropped 43 percent this year.

BusinessDesk.co.nz

Comments from our readers

No comments yet