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

 

Interest Rates: RBNZ Hikes OCR To 3.5%, ‘Period Of Assessment’ Now Needed

Reserve Bank governor Graeme Wheeler raised the official cash rate as expected, while signalling a pause in rate hikes to assess the impact of moves so far this year. The kiwi dollar sank after Wheeler said its strength was “unjustified” and that the currency could have “a significant fall.” More>>

ALSO:

Fonterra: Canpac Site 'Resize' To Focus More On Paediatrics

Fonterra is looking at realigning its packing operations at Canpac, in the Waikato, to focus more on paediatric nutritionals... The proposed changes could mean around 110 roles may not be required at the site which currently employs 330. More>>

ALSO:

Scoop Business: Postie Plus Brand Gets 2nd Chance With Well-Funded Pepkor

The Postie Plus brand is getting a new lease of life after South Africa’s Pepkor bought the failed retailer’s assets out of administration and said it will use its purchasing power to reduce costs of stock and fatten margins. More>>

ALSO:

Warming: Warming Signs From State Of Climate Report

Climate data from air, land, sea and ice in 2013 'reflect trends of a warming planet' -- says the latest State of the Climate report, launched by U.S. and New Zealand scientists. More>>

ALSO:

Scoop Business: Embrace Falling Home Affordability, Says NZIER

Despair over the inability to afford a house is misplaced and should be embraced as an opportunity to invest in more wealth-creating activity, says the principal economist at the New Zealand Institute of Economic Research, Shamubeel Eaqub. More>>

Productivity Commission: NZ Regulation Not Keeping Pace

New Zealand regulators often have to work with out-of-date legislation, quality checks are under strain, and regulatory workers need better training and development. More>>

ALSO:

Callaghan Innovation: Investment To Help Deepen Innovation Reporting

Callaghan Innovation, the government’s high tech HQ for Kiwi business, is to help deepen New Zealand media coverage of the commercialisation of innovation through an arms-length partnership with independent business news service BusinessDesk. More>>

ALSO:

Tax Credits, Grants: Greens $1Bn R&D Plan

In the Party’s headline economic announcement, the Greens have launched their plan to build a smarter, more innovative economy which has as its centrepiece an additional $1 billion of government investment in research and development (R&D) above current spend, including tax breaks for business. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

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