SOUTH EASTERN SECURED INVESTMENTS LIMITED
MEDIA RELEASE - 4 MAY 2009
Second distribution for SESI depositors
KordaMentha today announced a second distribution of 10 cents in the dollar to South Eastern Secured Investments Limited (SESI) debenture holders, less than 90 days after the appointment of Receivers and Managers to the Gippsland-based rural finance company. Media enquiries: Mark Uebergang 0410 520 195 or muebergang@kordamentha.com MEDIA RELEASE - 10 MARCH 2009 First distribution for SESI depositors KordaMentha today announced a first distribution of 10 cents in the dollar to South Eastern Secured Investments Limited (SESI) debenture holders, less than one month after the appointment of Receivers and Managers to the Gippsland-based rural finance company. Media enquiries: Michael Smith 0411 055 306 MEDIA RELEASE - 11 FEBRUARY
2009 Mark
Korda and Craig Shepard of KordaMentha were today appointed Receivers and Managers
of South Eastern Secured Investments Limited (SESI), a Gippsland-based rural
finance company. Directors
of the unlisted public company asked the Trustees of the company’s debenture
trust deed to appoint Receivers and Managers to manage and protect the
interests of debenture holders who are owed an estimated $180 million. Craig
Shepard said that SESI would no longer be accepting deposits and that the
existing deposits of debenture holders would be frozen from today. Mr
Shepard also indicated the Receivers and Managers would be calling for
immediate expressions of interest in the sale of the business as a going
concern and that the business would continue to operate on a “business as usual
basis” whilst the sale process is conducted. SESI’s
headquarters are in Korumburra and regional offices are located in Sale,
Leongatha, Wonthaggi, Cowes and Yarram. SESI was established in 1995 to lend to
the local market. It has issued 10 prospectuses, most recently in September
2008. Mr
Shepard said it was too early to predict the ultimate position of debenture
holders or to be too precise about the reasons for the company’s problems.
However, the company has recently been adversely affected by the financial
difficulties of a major debtor and the decision by the Federal Government to
exclude companies like SESI from the Bank Deposit Guarantee Scheme. SESI
customers and debenture holders can find more information in the creditor
section of www.kordamentha.com, including
contact numbers for further enquiries. Media enquiries : Michael Smith
0411 055 306
Craig Shepard and Mark Korda of KordaMentha were appointed Receivers and Managers of SESI on 11 February 2009. About 3,000 depositors, mostly locals, were owed $178 million. All deposits were frozen immediately upon their appointment.
“We are delighted to announce a second distribution of 10 cents in the dollar, less than 90 days after the receivership commenced” said Mr Shepard. “Since our appointment in February, a total of $35 million has been distributed to SESI debenture holders, the majority of whom reside in the Gippsland region. We hope these distributions will alleviate the financial burden felt by many in the community and help to stimulate the local economy”
In their letter to investors, the Receivers and Managers advised that they are working closely with borrowers and local financiers to accelerate the realisation of the Company’s remaining assets. Mr Shepard announced he had reached an in principle agreement with Bendigo and Adelaide Bank under which around $20 million of SESI’s loans would be sold. Mr Shepard also indicated that discussions with other parties regarding the remainder of SESI’s assets are progressing satisfactorily.
“We hope that the sale to Bendigo Bank, in conjunction with other discussions and initiatives that are underway, will allow us to make another substantial distribution over the coming months” said Mr Shepard. “Our priority is to continue realising SESI’s assets and making distributions to investors as quickly as the inflow of funds will permit. Whilst this process will take time to complete, we are very pleased with the progress that has been made so far, which we attribute, in part, to the support of the company’s dedicated customers and staff”.
SESI employs seven staff with offices in Korumburra and Leongatha and agencies in Sale, Wonthaggi, Cowes and Yarram. In February, SESI’s directors asked the Trustees of the company’s debenture trust deed to appoint Receivers and Managers to protect the interests of debenture holders after the company was affected by a default from a major debtor, looming write-downs on $17 million of collateralised debt obligations (CDOs) and the Federal Government’s decision to exclude companies like SESI from the bank deposit guarantee scheme.
Craig Shepard and Mark Korda of KordaMentha were appointed Receivers and Managers of SESI on 11 February 2009. About 3000 debenture holders, mostly locals, were owed $178 million. All deposits were frozen immediately upon their appointment.
“This interim distribution is the first of many distributions we hope to make over the coming year” said Mr Shepard. “Whilst at this stage the eventual return to debenture holders is still unclear, the information available to us suggests that debenture holders should expect to receive a substantial return of their principal over time”
Mr Shepard said he believed the majority of the company’s assets could be sold or
collected over the coming 12 to 18 months and discussions are currently under way with several financial institutions interested in acquiring or refinancing parts of the company’s $148 million loan portfolio. “We hope to conclude these discussions soon and aim to make further distributions over the coming months” Mr Shepard said.
“Our role is to continue realising the company’s assets and to make distributions to the debenture holders as soon as the company’s cash flow will permit,” said Mr Shepard. “This distribution of $18.0 million to over 5,500 accounts represents a significant first step in the return of funds to investors. We are very pleased with the progress we’ve made in the receivership which we attribute, in part, to the support of the company’s dedicated customers and staff.”
SESI’s head office is in Korumburra. It has two offices and eight staff. A second office is located in Leongatha and SESI has agencies in Sale, Wonthaggi, Cowes and Yarram. Directors asked the Trustees of the company’s debenture trust deed to appoint Receivers and Managers to protect the interests of debenture holders after the company was affected by a default from a major debtor, looming write-downs on $17 million of collateralised debt obligations (CDOs) and the Federal Government’s decision to exclude companies like SESI from, the bank deposit guarantee scheme.