Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Mainzeal liquidator steps up pressure on director Yan

Mainzeal liquidator steps up pressure on director Yan over related entity

By Paul McBeth

April 3 (BusinessDesk) - The liquidators for the Mainzeal group are stepping up their pressure on former director Richard Yan as they try to get to the bottom of the construction company’s failure.

BDO’s Andrew Bethell, Brian Mayo-Smith and Stephen Tubbs have struggled to get detailed financial records of related Mainzeal entity, Richina Global Real Estate, which was added to their administration by a High Court order in February.

The liquidators haven’t been provided with detailed financial accounts for the company, including an accounting ledger believed to be in China, despite requesting the information from Yan, and can’t verify the accuracy of the records they’ve received, according to their first report.

“Despite requests, we do not consider that the director has provided all required and relevant information in relation to RGREL (Richina Global Real Estate),” the report said. “As a result we intend to examine the director.”

Under the Companies Act 1993, liquidators have the power to require a director or shareholder of a firm in administration to “deliver to the liquidator such books, records, or documents of the company in that person's possession or under that person's control.”

They can also seek to examine certain people, including directors and shareholders, under oath by the liquidator or lawyer “on any matter relating to the business, accounts, or affairs of the company.” Failure to comply carries a penalty of up to two years in prison or a fine of up to $50,000.

The statement of affairs based on the information shows assets of $63.3 million, of which $55.4 million are related party loans to MLG Trading and $7.8 million related party loans to Isola Vineyards. The report showed total liabilities of $24.3 million, of which $5.8 million was owed to related party King Façade, $15.2 million owed to Mainzeal Property & Construction and $2.5 million owed to Richina Building.

Yan is seeking to set aside the High Court decision for Richina Global Real Estate to contribute the $23 million owed to King Façade and Mainzeal Property & Construction to the wider administration. He’s also appealing the decision to put the company into liquidation with a hearing set for April 16.

The liquidators are investigating Richina Real Estate Group’s transactions with related parties in New Zealand and internationally, including the restructures of related party debts that occurred around July and December 2012, saying the commercial rationale wasn’t evident.

The December 2012 restructure saw the $15.2 million debt owed to Mainzeal Property & Construction transferred to MGL Trading in exchange for shares.

“As the transaction occurred only five weeks prior to MPCL being put into receivership, we consider those shares were worthless at the time of this restructure,” the report said.

The liquidators are also looking at extensions of other related party loans to be repayable within 10 years, subject to profitability, and on interest free terms.

“We are continuing to investigate the validity of these restructures and will take further action if we consider it to be appropriate,” the report said.

Mainzeal Property & Construction and Mainzeal Living were tipped into receivership on Feb. 6 last year, the Waitangi Day public holiday, and 200 Vic joined them on Feb. 13. Liquidators were appointed to the Mainzeal group later that month on Feb. 28.

The receivership of Mainzeal Property & Construction left a surplus of $1.1 million for the liquidators of the wider group, who represent unsecured creditors who have lodged claims worth at least $139.3 million. The receivers were appointed by Bank of New Zealand, which was owed $11.3 million, the bulk of which was over the Mainzeal headquarters building on Auckland’s Victoria St.

If the liquidators aren’t successful in achieving a significant recovery from the related party loans, any distribution to unsecured creditors “is not likely to be substantial,” they said in their latest report on the wider administration.

Former Prime Minister Jenny Shipley and former Brierley Investments chief executive Paul Collins resigned as directors of Mainzeal Property & Construction in December 2012, at the request of Mainzeal and Richina group principal Yan. They remained directors of Mainzeal Group until just before the MPC receivership.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Fruit & Veg Crackdown: Auckland Fruit Fly Find Under Investigation

The Ministry for Primary Industries (MPI) is investigating a find of a single male Queensland fruit fly in a surveillance trap in the Auckland suburb of Grey Lynn... MPI has placed legal controls on the movement of fruit and some vegetables outside of a defined circular area which extends 1.5km from where the fly was trapped in Grey Lynn. More>>

ALSO:

Scoop Business: Westpac NZ Reaches $2.97M Swaps Settlement

Westpac Banking Corp’s New Zealand unit has agreed to pay $2.97 million in a settlement with the Commerce Commission over the way the bank sold interest rate swaps to farmers between 2005 and 2012. More>>

ALSO:

Going Dutch: Fonterra Kicks Off $144M Partnership With Dutch Cheese Maker

Fonterra Co-operative Group, the world’s largest dairy exporter, has commissioned a new dairy ingredients plant in Heerenveen, in the north of the Netherlands, its first wholly-owned and operated ingredients plant in Europe. More>>

ALSO:

Scoop Business: NZ Retail Sales Beat Estimates

New Zealand retail sales rose more than expected in the fourth quarter, led by vehicle-related transactions, food and beverages, adding to evidence that cheap credit and a growing jobs market are encouraging consumers to spend. More>>

ALSO:

Delivery Cuts Go Ahead: 'Government Money Grab' From NZ Post

"It's a money grab by the Government as the shareholder of New Zealand Post" says Postal Workers Union advocate Graeme Clarke about the changes announced by NZ Post. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news