Receivership for St Laurence

St Laurence's debt for equity swap proposal didn't look convincing in the first place. So it is no surprise that the trustee, Perpetual Trust, intervened and appointed Deloitte as receivers for the company.

Perpetual cites a number of reasons for the sudden move, including the company's indication that it would soon become insolvent. The main trigger, however, was managing director Kevin Podmore's decision to send the debt for equity proposal to investors despite being told not to do so by Perpetual. According to Perpetual, the company has not been fully transparent with the trustee and therefore it was prudent to remove the current directors and management from the process of recovering money for investors.

At 2009 St Laurence had total assets of NZ$184 million, which included loans and advances of just NZ$46 million. The balance is mainly investment in subsidiaries and associates, totalling NZ$113 million.  

With the company admitting that the downturn in the property market has continued to adversely affect it, it is likely that the assets level has seen further significant erosion.

Meanwhile, in a response to the trustee's move, Podmore says the letter sent to investors was neither misleading nor did it require trustee approval.