New Zealand

The Serious Fraud Office (SFO) will make an arrest tomorrow in a case that involves tens of millions of dollars of investor losses, The National Business Review reported. News of the arrest came as SFO chief executive Adam Feeley appeared before Parliament's Law and Order select committee. Asked to explain how the SFO pursues its investigations and uses other organisations and contractors, he dramatically gave the arrest tomorrow as an example.

Government-guaranteed finance company Equitable Mortgages called in receivers Friday, The New Zealand Herald reported. The Auckland-based financial institution has around 6000 depositors and approximately $178 million in Crown-guaranteed deposits. Eligible depositors with Equitable Mortgages can claim repayment from the Crown, Treasury's deputy secretary of financial operations Phil Combes said yesterday.

Grain company Keith Seeds has sold its assets to NZ company PGG Wrightson and entered voluntary administration, AdelaideNow reported on a story in The Advertiser. The company has an estimated $7 million in debt. PGG told the New Zealand stock exchange yesterday it completed the purchase of the assets of Keith Seeds on Monday, for an undisclosed sum. The company will use Keith Seeds as a base to expand its existing South Australian operations. But the transaction could leave an estimated 200 suppliers out of pocket by $7 million, with no assets against which to claim.

Andrew Krukziener’s date with creditors has arrived. The Auckland developer, $47 million in debt, is expected to give evidence at the High Court at Auckland as he seeks to avert bankruptcy, The National Business Review reported. The hearing began yesterday when the court heard details of his proposal to repay creditors $350,000 in instalments over four-and-a-half years. The IRD, which claims it is owed $6.67 million by Krukziener, is opposing the proposal and wants to press ahead to have him declared bankrupt. Eighteen other creditors have accepted the proposal.

Allied Farmers has fired a broadside at Hanover Finance owners Mark Hotchin and Eric Watson after receivers were appointed today to Matarangi Beach Estates, a Coromandel property development company it acquired in a swap deal with Hanover last December, BusinessDay.co.nz reported. In an announcement to the stock exchange today Allied said it had been unable to strike a deal with lender HSBC, owed $19 million by Matarangi Beach Estates, and had therefore appointed receiver Korda Mentha.

The last-minute transfer of millions in cash from Australia to New Zealand has contributed to huge losses for investors in an Australian arm of Bridgecorp, BusinessDay.co.nz reported. But another questionable loan transaction between the two may have left New Zealand investors with the worst part of the deal. Receivers of Bridgecorp Finance told debenture investors this month they will get just A5.6 cents in the dollar after the company's high risk property lending, particularly to developments by former Australian test cricketer Craig McDermott, proved unrecoverable.

Allied Farmers, which took on the Hanover and United loan books in a failed bid to become a major lender, faces losing another $7 million after HSBC pulled the credit line on one of the firm's subsidiaries, ShareChat.co.nz reported. The Hong Kong-based lender called its $19 million loan facility to Matarangi Beach Estates after Allied refused to put up the same guarantee as the previous owners, Eric Watson and Mark Hotchin, who had poured the vehicle into Hanover to try to keep it afloat.

Receivers for the Jean Jones clothing stores say they have received an excellent response from potential buyers and expect a sale before the end of the year, The National Business Review reported. Receiver Mike Horne, of Deloitte, said a review of the company's position confirmed earlier indications that the nationwide women's fashion chain was fundamentally a strong business and its problems were primarily caused by factors external to its operations. Jean Jones' loyal customer base and viable business model meant there was strong interest from prospective buyers, Mr Horne said.

Failed property developer Patrick Fontein is fighting to stave off bankruptcy in the High Court at Auckland today, BusinessDay.co.nz reported. Creditor Bank of New Zealand wants Fontein adjudged bankrupt for debts totalling $93 million, owed to 45 creditors. The money is owed from the collapse of companies associated with Fontein's Kensington Park Developments. The bank says Fontein breached loan agreements for the Kensington Park development at Orewa north of Auckland by diverting funds to another development - the Huka Falls Resort outside of Taupo.

Two Southbury companies placed in receivership yesterday owed South Canterbury Finance about $156 million, say receivers, BusinessDay.co.nz reported. Southbury Corporation, 100 per cent owner of the finance company, owed it $74m, while Southbury Group, 100 per cent owner of Southbury Corporation, owed $82m. Southbury Group was the main holding company for Timaru millionaire Allan Hubbard, whose affairs are now in statutory management. Receiver Kerryn Downey of McGrath Nicol said the loans were part of a ''complex web'' of transactions involving all three companies.