Indebted Mercer Group settles insurance claim for $2.67 million, shares jump
Mercer Group [NZX: MGL], the stainless steel fabricator, has settled an insurance claim with IAG over damage to a property in the Christchurch earthquakes in 2010 and 2011.
IAG is to pay $2.7 million plus GST to Mercer to conclude the claim over the building on Lunns Rd in Christchurch.
Mercer's directors were forced to add a note to its recent accounts stating a "material uncertainty" over the company's ability to continue as a going concern if its lenders were not willing to provide the necessary debt facilities and it was unable to secure funding elsewhere. It posted a loss of $4.6 million for the last six months of 2015 compared to a loss of $101,000 in the same period a year earlier and owes $21 million in total.
The shares rose by 3.5 percent to 3c and have tumbled 81% in the past year.
An earlier version of this story mistakenly named the insurer as AIG instead of IAG.