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Allied Farmers Proposal to Hanover Finance
Wednesday 18 November 2009
Hanover Finance today
confirmed Allied Farmers Ltd had forwarded a proposal to
acquire the finance assets of Hanover Finance Limited and
United Finance Limited.
Chairman David Henry said the
Allied Farmers Proposal would exchange investors Hanover
Finance’s secured deposits and subordinated notes, United
Finance’s secured deposits, and Hanover Capital bonds for
listed shares in Allied Farmers issued at market
value.
“If approved, the Allied Farmers Proposal
would see Hanover Finance Secured Depositors receive 78
cents in value for every $1.00 of original principal owed,
while United Finance Secured Deposit holders would receive
90 cents in value for every $1.00 of original principal owed
(these amounts are inclusive of payments of six cents
already made under the Debt Restructuring Plan (DRP) in
place since December last year).
Hanover Finance
Subordinated Note holders and Hanover Capital Bond holders
would receive 30 cents in value.
Mr Henry said Allied Farmers would acquire loans and property, finance assets, operating assets and the escrowed cash and property assets as described in the shareholder support package of the DRP.
“Directors have commissioned independent experts
Grant Samuel to provide a report for investors on the merits
of the Allied Farmers Proposal. This would include an
assessment of the Allied Farmers Proposal compared to the
existing DRP.
“Following receipt of Grant
Samuel’s independent expert report and consideration of
this report, the independent directors will make
recommendations to investors regarding the Allied Farmers
Proposal. At that time we will communicate fully to
investors prior to the vote required from them for the
Allied Farmers Proposal to be approved.
“The
Allied Farmers Proposal is dependent on 75% of Hanover and
United Finance investors voting in favour of the proposal,
50% of Allied Farmers’ shareholders also voting to approve
the proposal and other usual conditions.”
Mr Henry
noted that Hanover had recently released its latest
financial result confirming that a worsening property
development market meant that it no longer expected to
achieve full repayment of investors’ capital as originally
intended under the DRP.
Mr Henry says the directors
of Hanover will be writing to investors in the near future
to outline the nature of the Allied Farmers Proposal.
Details will also be posted on the website as they become
available.
To view the appendix with proposal details please see the following document: http://img.scoop.co.nz/media/pdfs/0911/Appendix1.doc
ENDS
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