Bad news for Bridgecorp investors

The news never gets better for Bridgecorp investors. A fresh update from receivers PriceWaterhouseCoopers has slashed the potential recovery rate range to 16-51% from 19-63% because of a slump in the property market and doubts about Bridgecorp’s Momi resort in Fiji.

PwC said if the Momi resort was cancelled, as was possible, then the most investors could recover would be 27% of the NZ8.7 million of “secured” debentures issued by Bridgecorp. At the low end of the estimate range, Bridgecorp investors will lose NZ3 million.

The receiver pointed out that property prices had fallen since its December estimate and some buyers of Bridgecorp properties had pulled out of deals legitimately. PwC also said many of Bridgecorp loans were second mortgages and other financiers holding the first mortgages on these properties were controlling the liquidation processes.

PwC said it had also started legal action against Bridgecorp directors, including founder Rod Petricevic, to recover monies paid to them before the collapse