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Propertyfinance Securities Runs Foul Of Securities Commission

Contributor:
Fuseworks Media
Fuseworks Media

Wellington, April 20 NZPA - Propertyfinance Securities Ltd (PSFL) has run foul of the Securities Commission for over-selling the merits of a restructuring.

The finance company was placed in receivership in August 2007 and is owned by listed company Property Finance Group Ltd.

The Securities Commission said it has banned advertisements by Propertyfinance Securities Ltd for the restructure of moratorium arrangements. PFSL has been in moratorium since December 2007.

The commission said PFSL is proposing to restructure its moratorium since failing to meet a scheduled payment in December 2008.

Its proposal involves varying the terms of the existing securities held by debenture holders, which amounts to a new offer of securities under the securities law.

The commission believed that roadshow presentations were likely to mislead investors because they set out only the positive aspects of the restructure proposal, and only the negative aspects of the receivership option.

This was unbalanced and likely to mislead investors.

" In the commission's view the offer does not comply with the law because there is no registered prospectus."

Moratorium documents are a form of offer documents and are therefore subject to the same rules as other offer documents.

Property Finance Group said in March a special meeting of Propertyfinance Securities debenture holders would be held to approve change in terms of debenture stock which give the company more flexibility.

According to its website PFSL was removed from receivership in February.

NZPA WGT pjg gt

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