Torchlight repays $9m to Perpetual CMF, now owes $3.5m
"The whole Torchlight saga is a total disgrace."
Featured commentBUSINESSDESK:Torchlight Fund No 1 LP, an entity controlled by Pyne Gould managing director George Kerr, has repaid $9 million owed to Pyne Gould’s Perpetual Cash Management Fund.
Transactions between the related entities, which amounted to more than $28 million, have been scrutinised by the Financial Markets Authority.
This month, the High Court ordered two independent observers keep tabs on Perpetual Trust's cash management and mortgage funds amid concerns over related party loans ahead of a substantial hearing on August 3.
The payment was made on Thursday and Friday of last week from the proceeds of sales of real estate, according to a statement from PR consultant David Lewis, once an adviser to former prime minister Helen Clark.
“These payments have reduced the Torchlight Fund facility balance to under $3.5 million,” Mr Lewis said. “It is anticipated that this residual balance will be paid shortly.”
Mr Kerr and US hedge fund Baker Street Capital own 76 percent of Pyne Gould via Australasian Equity Partners No 1 LP, after making a 37-cents-a-share takeover bid that closed in March.
Pyne Gould shares last traded at 27 cents, valuing the company at $58 million, and have dropped 21% this year.
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Comments and questions13
A cynic might speculate that PGC is selling down its Heartland and Wrightson's stakes to free up cash to purchase real estate from the Torchlight Fund. If not, Torchlight have been extraordinarily quick to liquidate some fairly illiquid real estate?
Oh hang on, these might be considered related party transactions, so surely not...
Let's see what the FMA comes up with.
A banning order on George Kerr and PGC from ever looking after investors' funds would be a good start.
Wish this had been done with SCF...
The story of PGC and George Kerr seems to be one of a merry-go-round of land, properties, shares, funds and other people's money between PGC, Torchlight, South Canterbury Finance, various financial institutions and him.
Have the trading banks had enough of all that and said to George "money back"?
Don't forget George still has the blue bloods behind him - so most of the legal fraternity will be too weak to take action against him , even if the authorities take action.
The whole Torchlight saga is a total disgrace.
The reason why the dodgy one is in trouble is precisely because the blue blooded ones have cut him adrift. You can only fool so many for only so long.
Don't underestimate the blue bloods - they pop up when you don't expect it.
George Kerr will have favours to be returned, which he can draw on from his blue blodd mates.
Is Kerr is taking PGC and those that stayed on board down a slippery slope, unlikely.
Marac's managment made big losses to shareholders, never forget that. Heartland is still managed by in large by those guys. Torchlight is the bad property loan book cashed out of the Marac books to get the figures looking better.
Property is not that hard to move at present, so Kerr made a win. You guys above blame Kerr when the Marac middle management are the culprits.
Clearly Kerr has some problems, let’s see how that pans out. He seems capable of paying down related party debt which means the company is not vulnerable.
Property not that hard to move? Obviously not if you fire sale which is what the dodgy one has been doing with the Wrightson and Heartland shares.
Think of the Heartland shares - many were bought at 75 cents per share and were sold at 52 cents. Makes sense to you?
PGC's strategy was to make Marac clean, merge it with two building societies and become a bank. That is on the way but the dodgy one has had to sell out now that his pants are on fire.
BTW - Kerr was on the board of PGC when all those bad property loans were made. Have a guess where some of Marac's property loans were to?
On 16 July PGC announced to the NZX that "the MD will provide a statement on the investment strategy this week".
Nothing. Will NZX take some action?
Make an official compliant to the NZX, cc the FMA.
That will get PGC and the NZX hopping.
Surely his actions are more meaningful than any statement. Why would you remain a shareholder? Why would you leave money with Perpetual? Stop moaning, sell down and move on. You made a bad decision. You backed the wrong horse.
Torchlight investors I have spoken to reckon GK will soon share a cell with Roddy et al... , what a Pyne in the A*se for him!