Whitcoulls creditors accept 3c in the dollar payment
Whitcoulls creditors have voted to take a 3c in the dollar return instead of liquidating the company that owes them $21.5 million.
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Whitcoulls creditors have voted in favour of a pittiful 3c in the dollar return instead of liquidating the company that owes them $21.5 million.
Unsecured creditors have just voted with an overwhelming majority of 84% in favour of a return of just 3c at a watershed meeting with Australian-based administrators Ferrier Hodgson in Auckland.
Ferrier Hodgson asked the unsecured creditors of Whitcoulls' parent company Red Group Retail to accept 3 cents in the dollar, instead of liquidation, in a deed of company arrangement (DOCA).
This was challenged by Auckland liquidator Damien Grant, who urged creditors to vote down the offer in favour of liquidation, which would provide for a fresh look at the company.
He told creditors who met at Auckland's Mercure Hotel he was "pretty confident" terms of a general security agreement (GSA) struck with Red Group Retail's ultimate owner Pacific Equity Partners in December, which Whitcoulls guaranteed, could be challenged in court.
"Turn it down because you can't guarantee the 3c," he said. It's better to take your chances in court."
Ferrier Hodgson said it had explored the strength of legal challenges to the GSA agreement through independent lawyers and did not believe there was a case.
Forty-seven Whitcoulls creditors voted for the 3c return and nine voted against, while 13 Borders creditors voted for the 3c return and five voted against.
Georgina Bond
Thu, 04 Aug 2011
Thu, 04 Aug 2011
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Whitcoulls creditors accept 3c in the dollar payment
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