Allied Nationwide bondholders not guaranteed

Allied Nationwide bondholders not guaranteed

by Paul McBeth

Oct. 21 (BusinessDesk) – Investors holding the listed perpetual bonds of Allied Nationwide Finance Ltd., the failed finance unit of Allied Farmers Ltd., won’t get their money back, as the securities are not covered by the government’s guarantee.

Receiver Andrew Grenfell of McGrathNicol said in his first report that the $13.5 million in bonds were subordinated, unsecured debt and not eligible for the retail deposit guarantee.

However, some 4,500 debenture and deposit holders with $128 milliion invested are covered by the guarantee. It isn’t clear whether the government will claw back any of that sum.

“We have omitted our realisation estimate of the assets as we believe that their inclusion could materially prejudice the exercise of our functions and in particular our duty to obtain the best price reasonably obtainable for the company’s assets,” Grenfell said.

The report came out the same day parent Allied Farmers said it had repaid its term loan with Westpac Banking Corp., and had restructured its related party debt with its subsidiary into secured loan facilities.

Allied Farmers owed almost $12 million to its failed finance unit, as at Aug. 31.

The shares climbed 0.6 cents to 2.1 cents in trading today.

(BusinessDesk) 18:29:26

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