Wednesday, December 16, 2009

Hanover victims vote to transfer Watson/Hotchin's toxic assets to Allied Farmers

Victims of corporate scumbags Eric Watson and Mark Hotchin who "invested" in their finance companies voted today in favour of the $396 million deal to transfer the finance companies' assets to Allied Farmers in return for shares in Allied Farmers.

The vote was close, with Hanover Finance secured depositors voting 75.45% in favour and United Finance investors voting 79.48% in favour. The other investor classes, including subordinated noteholders and Hanover Capital investors were more supportive, voting 97.47% and 88.33% in favour.

The deal required 75% approval from each class.

Most of Hanover’s "performing" assets will now be transferred to Allied Nationwide Finance business while the "poorer ones" will transferred into an “asset hospital” to be managed through to maturity.

Allied Farmers made a $34 million loss itself last year, the result of goodwill writedowns and "impairments and tough trading" in the rural sector.

One investor at today's meeting praised Hanover co-owner Mark Hotchin "for at least having the guts to front up. Better than that chicken-livered Eric Watson." Another described Mr Watson as a "shyster."

In September 2006, transpress's directors were invited to an address by the chief economist of one of the major banks. One of the questions asked there was what the bank thought of the finance companies - the answer was "we think most of them are toast." At about the same time the Retirement Commissioner was telling people that "the return of your money is more important than the return on your money."

So why did people want to invest with crooks like Watson and Hotchin? Were they just a little bit greedy themselves, wanting a higher return than what the registered banks were offering them? Undoubtedly. But that does not excuse in any way Watson/Hotchin's atrocious behaviour.

We can only hope that anyone who can help ensure that the lives of these crooks are made as much of a misery as they have made the lives of their victims, until they repay what they owe, will do so.

The photo shows Watson at a high society party in New York with Swedish model Lisa Henreckson.

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