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RAM Liquidation Must Work for Investors

Ross Asset Management Investors Group

23 November 2012: For immediate release.

MEDIA RELEASE – RAM Liquidation Must Work for Investors

The Ross Asset Management Investors Group is deeply concerned that it is now confirmed that there is very little money left in RAM (Ross Asset Management in receivership) for distribution to investors. Most of the investors were ordinary New Zealanders of limited means, and many have been left destitute by the failure of the company.

We are also aware that the High Court will probably put RAM into liquidation on Monday. This may start a process, which based on previous liquidations in this country, may involve extensive litigation and costs that absorb all the remaining investor’s funds, and leave investors with little or nothing.

We are calling for the work of liquidator to be put out to competitive tender, with the following provisos:

• That tenderers for the work be required to describe their liquidation methodology in advance; how they will control and minimise all costs to RAM investors, while maximising returns to RAM investors.

• This will include limiting the direct cost of the liquidator themselves and limiting the cost of litigation by the liquidator and by investors, especially if a voidable preference regime or similar is implemented. The methodology must be flexible to cater for a range of potential paths and outcomes.

• The successful tenderer is to be chosen on the combination of maximum returns to investors, least overall cost, and previous experience.

The available pool of funds from RAM is small and investors can only hope to get a part of their investments back. It is incumbent on the authorities to conduct this liquidation in a manner that does not allow what little is left to be devoured by fees and litigation.

RAM investors and all investors in New Zealand deserve an investment environment that works.

Ends

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