Sell the mansion? Not an option

Hanover co-owner Mark Hotchin supports the Allied deal because it will allow investors to recover some money. Photo / Richard Robinson

With toilet paper stuck to the heel of his shoe, Hanover co-owner Mark Hotchin walked into his Auckland investor meeting yesterday.

He might have needed it to deal with some of what was thrown at him by the angry crowd of 400 people.

Supporter Mark Thomas spotted it and stepped in to the rescue, just after Mr Hotchin had mounted the podium at Alexandra Park where he fronted up to angry Hanover and United Finance investors.

"Sell your blimmin million-dollar house," yelled one irate investor of the $30 million Paritai Drive mansion Mr Hotchin is building.

"Bloody right," retorted another.

"You've got off scot-free," yelled another when he told of investing millions.

"Mark Hotchin has not even had the temerity to say sorry," shouted another investor.

The meeting closed with shouts of "bastards", but not before investors called for Hotchin to contribute more money to help them out.

Mr Hotchin, who was flanked by bodyguards for the meeting, said afterwards he was surprised at investors directing virtually every question towards Allied Farmers' directors, who have put up a rescue proposal for Hanover's investors.

That was different from other meetings held around the country in the last few days, he said.

"I left it too late to speak. No one asked me any questions. I'll change that next Wednesday," Mr Hotchin promised a small band of investors afterwards, referring to the 10.30am meeting next week at Ellerslie.

There, the Allied debt-for-equity swap will be put to a final vote and 75 per cent of Hanover and United investors must agree.

Investor Tom Brosnahan said afterwards he was disgusted and would vote against the deal.

"I feel frustrated. It was a lot of waffle," he said, adding he'd asked Mr Hotchin if he was going to sell his new house to help investors out. "He said it wasn't an option."

Mr Hotchin told investors he regretted the situation.

"Clearly we are all very sorry to be here. I certainly am," he said, adding that he supported the Allied deal because it would allow investors to at least recover some money.

"These guys have a base and a business model which goes forward and it doesn't just shrink down a hole," he said.

Receivership was an unpalatable option and an alternative to Allied, Mr Hotchin said.

But a receiver would sell properties and this would return low sums to investors, he said, citing other failed financiers such as Orange where investors might only get 12-15 per cent of their money back, Capital + Merchant, only 0-2 per cent, and Dominion Finance, 10-15 per cent.

"Allied don't need to sell to move forward. We do. We have to. I don't want to be the one standing here saying we have a whole pile of troubled assets. The market has turned a long, long way," Mr Hotchin said.

But one investor shouted, "You said this 12 months ago. Same shit, same face, different day".

Many elderly investors cried out that they needed their money now.

Some told Mr Hotchin afterwards that they would be forced to sell family homes, and others said, "Look at our age".