An old friend has bolstered the balance sheet of South Canterbury Finance (SCF) with an injection of capital.
The Torchlight Fund will effectively pump $22 million into the firm by buying secured convertible notes from Southbury Corporation, which owns SCF.
The fund has the option of increasing this to $37.5 million by the end of April.
Last year, the fund provided funding to SCF to help repay US investors.
The chief executive of South Canterbury Finance, Sandy Maier, says it's the latest step in the firm's recapitalisation plan.
Three-way split expected to save money
Analysts estimate it may need to raise anywhere between $100 million and $400 million to satisfy regulators and credit-rating agencies.
But Mr Maier says much less than that may be needed, because of the firm's plans to split into three - separating its bad loans from its well-performing finance business and investment arm.
He says the split should be completed soon after Easter.
He also says that just over $200 million of equity has been injected into SCF since December, including the assets, Helicopters New Zealand and Scales Corporation.