Aorangi stoush with Jean Hubbard key to size of return
Aorangi stoush with Jean Hubbard key to size of return to investors, managers say
Feb. 4 (BusinessDesk) – A Timaru High Court hearing set for May on whether Aorangi Securities or the Hubbards own $60 million of disputed assets is key to whether investors in the failed group get most of their money back or only a third of the funds, the statutory managers say.
The Aorangi investors have so far received 15 cents in the dollar, or $14.5 million of the $96 million owed.
If the High Court rules the ‘introduced assets’ belong to Aorangi, the investors could get “almost all of their investment capital back." If Jean Hubbard wins, the total payout may be 35 cents in the dollar, or $34 million, statutory managers Richard Simpson, Trevor Thornton and Graeme McGlinn of Grant Thornton say in their 13th report.
The introduced assets were shares and loans in farm owning companies, partnerships and commercial entities introduced to Aorangi by the late businessman Allan Hubbard and wife Jean between April 2009 and March 2010. Jean Hubbard claims the assets belong to her and her husband’s estate.
As a result of the pending court hearing, funds from the sale of any introduced assets are being held in escrow pending the outcome.
By the court’s direction, Jean Hubbard’s legal costs are being at least partly funded by Aorangi itself and the latest managers’ report says that has amounted to $85,000. The money must be repaid if the managers win, they say.
The managers have recovered some $20 million of the $40 million in estimated gross recoveries of Aorangi’s third-party loans.
Grant Thornton’s fees for the administration of Aorangi rose to $3.6 million as at Dec. 21, bringing total costs to $7.1 million including legal advice. That’s up from the $2.99 million accrued to Grant Thornton and total costs of $5.7 million as at the end of August last year.
Costs related to the Te Tua Charitable Trust were $680,140 for Grant Thornton out of a total $1.1 million.
The court case is set for May 20 having been postponed last year at the request of Grant Thornton after it found additional documents in storage related to the case.
Former Commerce Minister Simon Power appointed Grant Thornton as statutory managers of the Hubbards and various entities in mid-2010.