KEY POINTS:
Completion of a restructuring plan for Hanover Finance is being targeted for the end of the month, chairman Greg Muir says.
In a letter to investors this week, Muir also reiterated that shareholders in the company had said they would provide further support for the proposed restructure.
Finance company Hanover last month froze $554 million of funds owed to 16,500 investors. Key shareholders are rich listers Eric Watson and Mark Hotchin.
In this week's letter, Muir said it was important to keep in mind that the move to restructure was made to preserve value, and thus protect the interests of investors.
He also said the commitment from shareholders who had pledged additional financial support was "very real".
"We understand that people are keen to quantify the support the shareholders will offer on top of the equity they already have in the company," Muir said.
"However, it would be inappropriate to pre-empt this while the company follows through due process with the trustees and their advisers."
He gave an assurance the plan would include financial support from the shareholders.
On television last week, Muir said the owners had $50m of capital at risk in the business and the plan "will have tens of millions of dollars more from them supporting the business as we go through the recovery plan".
In his letter, he said it was important for investors to keep in mind that the shareholders' equity ranked behind debenture monies - "meaning that debenture investors get paid out before any of this money is accessible to shareholders".
After the restructure plan was finalised a series of meetings would be held around the country at which key components of the plan would be presented to investors.
Based on the indicative timetable, investors would formally vote on the proposal at meetings toward the end of September or early October.
- NZPA
