Bridgecorp investors lose $106m more as Fiji takes over Momi Bay

The Momi Resort near Nadi on the Island of Viti Levu, Fiji. Photo/Dean Purcell

The Fiji National Provident Fund is taking over the Momi Bay resort project in an attempt to claw back its $F80 million ($61.3m) investment.

Fiji National Provident Fund chairman Parmesh Chand told the Fiji Times today that the fund was now exercising its right as a mortgagor.

The foreclosure appears to end any hope New Zealand investors in failed finance company Bridgecorp have of recovering $106.6m the finance company's executives sank into the resort.

On most of its loans, Bridgecorp was not the first-ranking mortgagee, and returns from $32.9 million worth of Australian loans are also likely to be minimal.

Receivers PricewaterhouseCoopers (PWC) initially said in their six-monthly report on Bridgecorp -- which collapsed in July 2007 owing $459m to 14,360 secured debenture holders -- the final payout would be between 13c and 44c in the dollar.

The largest loan the company had was to Fiji's Momi Resort, but Colin McCloy and Maurice Noone of PWC have only said they were working with the developer and financiers to try to secure funding to complete the project.

Last year investors were told of a recovery between 13c and 21c in the dollar, excluding the Momi Bay resort, but since then they have been told that excluding the overseas assets and ongoing legal matters, secured debenture investors are likely to receive less than 10c in the dollar.

The project was to have been the largest resort development in Fiji and the South Pacific.

It was to have been the first to have over-water bungalows, the first Marriott Resort, the first Ritz Carlton and the first public-private partnership in Fiji.

News of the project's troubles first emerged in 2006 when the project was 12 months behind schedule and in need of more funds.

Earlier this year, Bridgecorp chairman Bruce Davidson and non-executive directors Gary Urwin and Peter Steigrad were charged by the Securities Commission for making false statements in investment statements and registered prospectuses of the company.

- NZPA