Mike Pero Mortgages thriving - founder
Christchurch businessman Mike Pero says an ongoing dispute between the joint venture owners of Mike Pero Mortgages, the firm he founded, is having no impact on the profitable and high-volume business.
In February, Melbourne-based Liberty Financial lodged in the High Court in Auckland a statement of claim against joint venture partner NZF Group, saying the NZX-listed group had breached the terms of the mortgage brokerage venture.
On Friday, Auckland-based Liberty Financial executive director Peter Rollason said the company did not want to discuss the statement of claim, but the legal proceedings were ongoing.
In a previous statement he said Liberty was acting in the best interests of Mike Pero Mortgages customers and franchises, and was in the strongest position to provide meaningful support.
Following Liberty Financial's February action, NZF Group issued a statement saying it believed the court action taken by Liberty was an unwarranted attempt to force NZF to compulsorily transfer its Mike Pero Mortages shareholding to Liberty. This would be required if NZF had triggered an event of default under the joint venture agreement.
Since then, NZF Group has faced further difficulties. The receivers of its subsidiary, NZF Money, put into receivership in July, have obtained a High Court order to freeze the assets of NZF Group.
NZF Group chief executive Mark Thornton said on Friday the group was considering an appeal against the decision freezing its assets, and would sell the stake in the brokerage in the right circumstances. He had no further comment.
Pero remains a director of Mike Pero Mortgages though he sold most of his stake in the business in 2004.
Pero said the legal dispute and moves by the NZF Money receivers were having no impact on Mike Pero Mortgages, which remained very profitable and trading well independent of its owners and under the directors and management team led by chief executive Shaun Riley.
Within the agreement between NZF Group and Liberty Financial there were provisions to enable the mortgage group to carry on as usual if there was a dispute between the shareholding partners or one was hampered by having its assets frozen, he said.
"Look, to be honest, Liberty Financial are huge in Australia by comparison, and very well placed.
"There's two strong parties there. One of them is obviously having difficulties or challenges at the moment."
The difficulties had not been an issue when it came to Mike Pero Mortgages operations which were experiencing a "boom" in Auckland and Christchurch, he added.
"[In Christchurch] people are relocating. Some of our traders are busier than they've ever been [and] mortgage production is certainly higher than the pre-global financial crisis days ... sales are significantly up on the last four years," he said.
Do you feel better or worse off than a year ago?Related story: Election jitters see confidence fall