Mainzeal receivers realise $22.5 mln, see leftovers for liquidator
The receivers for failed construction firm Mainzeal Property and Construction have raised some $22.5 million in asset sales and recoveries from outstanding contracts, and are confident there will be some money left over for the liquidator to mop up.
PwC's David Bridgman and Colin McCloy expect to have surplus funds for the liquidators once they've finished managing the receivership of the Mainzeal companies they are overseeing, according to their first six-monthly report. Of the $111.4 million in known assets identified, the pair have recovered $9.4 million from contract receivables, $4.6 million from selling construction assets, and $9.7 million from property sales, as at Aug. 5.
Between Feb. 6 and Aug. 5 the receivers made payments of $18.6 million, including a $4.9 million payment to the secured creditor, $5.3 million in contract expenses to complete work, $2.4 million for staff and $2.4 million in receivers' fees. That left net funds of almost $3.9 million at the end of the period.
With the sale of Mainzeal's former headquarters owned by related party 200 Vic Ltd likely to cover secured creditor Bank of New Zealand, Bridgman and McCloy say it is "likely that upon the retirement the receivers will be able to provide the liquidators with a surplus from net realisations."
The liquidators represent unsecured creditors owed some $106.3 million, whereas the receivers were appointed by BNZ who was owed $11.3 million, the bulk of which was over the Victoria St building. Preferential creditors, including staff entitlements and outstanding tax, are owed about $5.3 million.
The receivers are working with liquidators Brian Mayo-Smith, Andrew Bethell and Stephen Tubbs of BDO in pursuing some $46.6 million in related party debt, which stemmed from two significant restructures in the two years leading up to the group's collapse.
In the liquidator's latest update last month, Mayo-Smith, Bethell and Tubbs said the quantum of any distribution to unsecured creditors will depend on the pursuit of the related party debts, and if unsuccessful, any return "is not likely to be substantial."
Mainzeal Property and Construction and Mainzeal Living were tipped into receivership on Feb. 6, 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.
Former Prime Minister Jenny Shipley and former Brierley Investments chief executive Paul Collins resigned as directors of Mainzeal Property and Construction in December, at the request of Mainzeal and Richina group principal Richard Yan, an Auckland-based businessman, but remained directors of Mainzeal Group until just before the MPC receivership.