Wellington property developer Terry Serepisos was bankrupted in the High Court in Wellington today after Associate Judge David Gendall knocked back yet another bid to play for more time.
Judge Gendall granted an application by South Canterbury Finance Ltd., owed some NZ$22.5 million, to declare Serepisos bankrupt after he failed to convince the court to grant him four more days to secure funding from a Hong Kong-based merchant bank. SCF replaced FM Custodians Ltd. last month.
Counsel for Serepisos, John Billington, unsuccessfully requested four more days to let a new credit facility enter the banking system. Judge Gendall said the loan, which was to be paid in two tranches of US$5 million and US$15 million, wasn’t enough to cover SCF’s loan, and because it was being paid to Century City Trust Ltd., an entity not facing liquidation proceedings, could still be drawn down or used as the basis to file an application overturning the bankruptcy.
The bid was “unsatisfactory given the 11th hour provision of this information,” Judge Gendall said. “There’s no doubt the debtor has committed an act of bankruptcy.”
SCF and supporting creditor Equitable Mortgages - both finance companies that collapsed into receivership with deposits covered by the Crown retail deposit guarantee scheme - opposed the last minute bid, with counsel for both creditors saying the terms for the last adjournment were not met. See more on Serepisos' debts to the taxpayer here.
Last month, Serepisos was granted adjournment to put forward a proposal to creditors that would sell down his property portfolio in an orderly fashion, in a bid to meet the entirety of the NZ$204 million owed to his lenders. The portfolio, made up of some 150 residential properties and more than six commercial buildings, was valued at NZ$232.5 million.
However, the proposal wasn’t advanced as Serepisos sought refinancing to help restructure his business, Billington told the court. The new facility was sourced from an unnamed merchant bank in Hong Kong.
Judge Gendall awarded costs to SCF and Equitable Mortgages on a 2B basis.
Last week, Serepisos relinquished his licence for the Wellington Phoenix Football club in Australia’s A-League, and promised reporters they would be surprised by events this week. The Phoenix licence was taken over by a consortium of Wellington businessmen.
Here is a video interview with Terry Serepisos from Friday »
(Update adds further detail).