PGC says Torchlight not in receivership

TIM HUNTER
Last updated 05:00 13/06/2014

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Listed company Pyne Gould Corporation says it may become involved in litigation over its part-owned investment vehicle Torchlight, but has given no details.

The stock exchange halted trading in PGC shares for about an hour yesterday after a media report said PGC's Torchlight Fund was in receivership.

Trading was stopped at 11.28am, and at 12.24pm PGC issued a statement saying the report was wrong, after which the NZX lifted the trading halt.

PGC said that, although a limited partnership, Torchlight Fund No 1, was in receivership, this was a shell that no longer held assets of the Torchlight Fund.

"The receivership is being challenged and likely to be subject of commercial litigation, PGC said.

"It relates to a dispute over a loan where the principal has been fully repaid but the parties cannot agree on the amount and timing of any residual payments."

PGC gave no information about how much money was involved in the dispute or who was challenging the receivership.

PGC owns 20.5 per cent of the fund and also acts as its manager.

At last balance date in December PGC's investment in the Torchlight Fund, which owns hotels and entertainment, property and media assets in Australia and the UK, was valued at $49.2 million.

In 2012 the fund was restructured to transfer its assets to a limited partnership registered in the Cayman Islands.

PGC's interim report showed the fund owed it $11.5m. After the PGC announcement NZX lifted the trading halt. The share price has since fallen 2 cents to 39c, valuing PGC at $81m.

PGC is majority-owned and controlled by Australia-based businessman George Kerr. The company transferred to Guernsey last year as a prelude to seeking a listing on the London Stock Exchange. Fairfax NZ

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