VTL business sale expected in new year

Nathans Finance receivers expect a sale of parent company VTL Group's 24seven Australasian vending franchise business in the New Year.

Nathans was placed in receivership in August, owing $166 million to around 6000 investors.

It is a wholly owned subsidiary of vending technology company VTL which shortly before Nathan's receivership announced it was insolvent due to a Companies Office investigation of Nathans.

In an update today receivers Colin McCloy and John Waller of PriceWaterHouseCoopers said a number of indicative offers for 24seven Australasia were being considered.

Preferred bidders would be invited to undertake due diligence early in the New Year, with a sale expected soon after, the receivers said.

They repeated an earlier indication that investors could recover an initial dividend of 10c to 15c in the dollar during the first quarter of 2008.

Further dividends to investors were anticipated in the medium to long term from future recoveries on Nathans' loans to VTL and other entities.

Limited funding continued to be provided to VTL to enable it to trade pending the sale and restructuring of some business units by way of a managed process to realise value over time, the receivers said.

Proceeds from that process would be used by VTL and other entities to reduce debt owing to Nathans, and ultimately generate returns to Nathans ' secured debenture investors.

Previously the receivers said that of $176m in total loans, Nathans had only six loans to unrelated third parties totalling $5.3m when it went into receivership.

Today the receivers said that along with the process to sell the 24seven business in Australia and New Zealand, VTL executives and PwC were working to strategically position the 24seven US business for sale.

Discussions continue with potential strategic investors interested in VTL's automated convenience store business Shop24 in Europe and the US.

The Shop24 business was in a development phase and needed further equity and a strategic partner to realise maximum value for Nathans' secured debenture investors.

The nature and timing of future returns to Nathans' secured debenture investors would become clearer once there was more certainty on how much would be received from the sale of VTL's businesses and the amount of debt that would enable VTL to repay to Nathans, the receivers said.

The New Zealand stock exchange had suspended VTL shares in August after it became insolvent, removed them from suspension in October, then suspended them again last month after VTL missed the deadline to provide its annual financial result.