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Pyne Gould confirms repayment of loan to SCF

Thursday 2nd September 2010

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Pyne Gould Corp. confirmed that a $100 million loan to South Canterbury Finance has been repaid following the finance company’s collapse into receivership.

PGC is a minority holder in Torchlight Fund No. 1, one of the parties that advanced the loan to SCF, through its Torchlight Investment Group subsidiary. Another subsidiary manages the fund.

The loan was repaid from a $175 million loan the government extended to Trustee Executors to settle prior claims on SCF, whose receivership has triggered a $1.6 billion call on the government’s retail guarantee.

PGC said the Torchlight Fund has committed capital of $150 million after raising capital in July. It specialises in making “counter-cyclical investments at a time of low liquidity in the banking and investment sectors,” it said.

Torchlight is PGC cornerstone shareholder George Kerr’s private equity vehicle which he uses to invest in distressed assets, holding them until they recoup their value.

PGC's shares were unchanged at 42 cents on the NZX.

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