Landmark could survive—receivers

Press, 6 September 1989, Page 38

Landmark could survive—receivers

PA Auckland The Landmark Corporation receivers’ first report to the trustee later this week is expected to recommend the continued trading of the Aucklandbased property investor, one of the receivers, Mr Keith Smith, says. “My attitude is positive; we are not in a fire sale situation. I would like to see Landmark carry on into the future.” He said that Landmark was one of the “better” receiverships to be involved with, in that the company could possibly come out of its present situation. It is now a month since Landmark was placed in receivership by its bankers after breaching a financial ratio in its secured debenture trust deed. At the time some of the debenture holders favoured waiving the deed requirements, but they were not united and Landmark could not avert

receivership. Mr Smith and Mrs Deborah Riordan of Spicer Oppenheim were appointed receivers, and Mr Smith said the first report to the trustee, New Zealand Guardian Trust, and the debenture holders would be ready by the end of the week. “They (debenture holders) will decide on the ultimate future of Landmark, but I can see Landmark carrying on for a number of months yet,” he said. The Landmark directors were completing the audit for the year to March 31. When Landmark went into receivership, it had assets estimated at $lOO million, including a portfolio of 12 buildings, and a 47 per cent shareholding in Kimberley Securities, an Australian listed property developer.

Landmark’s liabilities amounted to nearly S7OM. It had shareholders’ funds of S3OM. But it was having

cash flow difficulties, and a devaluation of its investments because of the downturn in the property market. Landmark was well into a rationalisation programme and had deposited S4M cash in the bank.

The asset selling continues with Landmark expected to complete an unconditional sale of a small building in the Auckland central business district this week. In the middle of this month the company will be auctioning two buildings - this was planned before the receivership.

“We decided to continue with the auction to test the market,” said Mr Smith. “But we are not letting them go cheaply; they will have reserve prices on them.” The properties are the five-storey Taspac Building at 6-8 Commerce St and the three-storey ALA House at 9 Gore St, Auckland.

Mr Smith is "very confident” over arranging a deal for the sale of Landmark’s stake in Kimberley.

Landmark has two other assets in Australia, one of them a development that is just beginning and will be completed next June. A Landmark spokesman said “we are continuing as before...we had done about as much as one could do in terms of finding buyers of property.” The company had not laid off any staff though it had already thinned its numbers to a working minimum of six. The spokesman said the company had a lot of interest in its properties, but “if anyone comes up with a ridiculous offer we just show him the door.” The task of the management with the support of the directors, he said, was to protect the shareholders’ funds, and not sell off properties at firesale prices.