Hubbard unites key investments under Southbury

Allan Hubbard

Businessman Allan Hubbard has put his three key investments together under new parent holding company Southbury Corporation.

The joining of South Canterbury Finance, Helicopters, and Scales Corporation had produced one of the most significant business combinations in the South Island, a statement from South Canterbury Finance today said.

Southbury had also carried out a private placement of $27.5 million of convertible notes as the first part of a two-stage capital raising.The $27.5m had been used to subscribe for new ordinary share capital in South Canterbury.

Hubbard, Southbury's major shareholder, said its formation and the issue of new notes convertible to equity were major restructuring steps.

In line with recent developments, it meant the company was "well on the way to a totally fresh approach to the future".

A downgrade of South Canterbury's credit rating by Standard & Poor's last August gave investors in the private placement market in the United States the right to be repaid US$100m ($135.2m).

Last month, there was good news for South Canterbury when S&P affirmed its BB plus long term rating and removed it from CreditWatch Negative, where it was placed in September 20.

Then, late in December it was announced that Harvard Law School and Yale graduate Sandy Maier had been appointed South Canterbury's chief executive.

Southbury, directly or through subsidiaries, owns 100 per cent of the ordinary shares of South Canterbury and Helicopters (NZ), and 79.7 per cent of Scales.

Today's statement said Southbury and its subsidiaries had consolidated total assets of about $2.8 billion and net assets of about $300m on a pro forma basis as at June 30, 2009.

The Southbury activities include commercial and consumer finance, helicopters, apple orchards, and cool stores.

Notes issued under the capital raising would convert into Southbury equity in the event of an initial public offering, or were otherwise redeemable for cash. South Canterbury had provided a guarantee for the redemption of the notes in exchange for an indemnity from Southbury.

- NZPA