Dorchester Pacific (DPC) hopes to raise up to $12 million through the issue of convertible notes.

Dorchester Pacific said its subsidiary Dorchester Finance will take an additional provision of about $1 million relating to loans to Ivan Erceg, who was adjudged bankrupt on February 2.

The provision reflects a likely shortfall between the security held and the loan due.

Dorchester said the position had already been incorporated in forecasts for the capital reconstruction plan currently being put to trustees prior to being sent to investors.

As reported, Mr Erceg's company Sensation Yachts has been in financial difficulties.

Dorchester Pacific has confirmed that its subsidiary Dorchester Finance will take an additional provision of approximately $1 million over a loan to boat builder Ivan Erceg.

The provision reflects a likely shortfall between its security held and the loan due from Mr Erceg who was recently adjudicated bankrupt, Dorchester said today.



Cayman Island-based yacht company Balenia finally succeeded on Tuesday during a hearing at the High Court at Auckland. Mr Erceg, who is still living in Europe, was announced bankrupt by Associate Judge Jeremy Doogue at 3.20pm on February 2.

Financial services company Dorchester Pacific has appointed Stephen Sinclair as a new non-executive director.

Mr Sinclair is a partner in The Business Bakery, which recently acquired a 19.47% shareholding in Dorchester from Auguste Finance.

The Business Bakery, a limited liability partnership founded by Geoff Ross, Grant Baker and Mr Sinclair, purchased 7.2 million Dorchester shares at 5.6c last month.

Dorchester Pacific executive director Paul Byrnes says the company still expects to meet its obligations to Dorchester Finance investors despite adding more than $8 million to the company’s provisions for loan losses in the past six months.

The company has already got the next couple of payments stashed away but whether the provisions will affect repayments over the next year or two will come down to what happens when the loans are actually realised.

Some $7 million of the extra provisions relate to property loans.