3 May 2010

Norgate investment firm goes into receivership

9:59 pm on 3 May 2010

Investors in a company co-owned by former Fonterra chief Craig Norgate are likely to get half their money back at best, because the company has run out of cash.

About 1400 investors own about $60 million worth of bonds in Rural Portfolio Capital (RPC), but at the company's request the bonds were delisted from the stock exchange on Monday morning.

Both RPC and its sister company, Rural Portfolio Investments, have gone into receivership and the companies' assets are now in the hands of Trustee Executors, which has named Kerryn Downey and Andrew Grenfell of McGrathNicol as receivers.

The executors say the assets affected include almost 47 million shares in PGG Wrightson, 10 million shares in New Zealand Farming Systems, and $750,000 in an escrow account.

The above shares were used as security against the bonds but at today's prices the sale of the shares, plus the $750,000 cash, would total just under $30 million - half of what investors are owed.

Considering moving overseas

Mr Norgate, who until last year was chairman of PGG Wrightson, jointly owns RPC with Baird McConnon. He says he's disappointed at the outcome but believes it is in the best interests of shareholders to wind the company up quickly.

Trustee Executors will decide how best to repay investors, he says.

Mr Norgate says he will personally retain a small shareholding in PGG Wrightson and NZ Farming Systems. He is considering moving overseas but says it's too early to speculate where, and what, he would do.