Allied warns of $1.8m loan writedown

JASON KRUPP
Last updated 15:26 25/06/2012

Relevant offers

Industries

New car sales up again in April Oil companies fined over hurt worker McDonald's NZ not yet affected by global restructure Spark ultrafast broadband finally gets voice Huge stretch of Manawatu Business Park up for sale Auckland port challenge heads to Appeal Court Auckland Council rejects Helensville housing developments Woolston gelatine factory Gelita gets two more years to discharge offensive odours Historic St Christopher's third Wellington church sold Fortune 500 bank's Kiwi ambitions

Allied Farmers, the rural services firm which failed to transform itself into a major lender, says it will probably have to write down the carrying value of an ex-Hanover property loan by $1.8 million.

The loan was secured over a property that's been in receivership for some time, and a draft estimate suggests the value may have dropped ''significantly lower than anticipated'' partly as a result of weather related damage, the company said in a statement to the NZX today.

The firm's wholly owned subsidiary, Allied Farmers Investments Limited, is the second ranking security holder on the loan. Allied said the $1.8m level is subject to change as it is still in discussions with the receiver.

The news comes as a blow to Allied's attempts to sell off the toxic assets it bought from Hanover several years ago in a bid to transform itself into a finance company.

Earlier this month the firm and Bank of Scotland International said they stood to make a $121m loss on the sale of the Gulf Harbour development north of Auckland.

Separately, Allied said it had negotiated an extension of a $13.4m secured term loan facility held by Allied Nationwide Finance Limited, the firm's finance arm which is currently in receivership.  

The loan is now payable on June 30, 2013, 12 months later that initially indicated. As of the end of December Allied had a cash in bank balance of $1.01m.

Allied shares were unchanged at 2.8 cents apiece today, and have shed 97 per cent of their value over the past 12 months.

Ad Feedback

- BusinessDay.co.nz

Special offers

Featured Promotions

Sponsored Content