Investors in Record Realty lose the lot DANNY JOHN March 19, 2010
Investors in Record Realty, the once-high flying property offshoot of Allco Finance, have been given the bad news they have long suspected: they will get nothing from its downfall.
The listed trust that owned the ASX's headquarters in Sydney before it was seized by the receivers on behalf of its bankers crumbled when administrators were appointed to its responsible entity, Record Funds Management, last August.
Since then, the corporate doctor PPB has been winding down its affairs and those at Record Realty, which at the height of the last equity and property booms was worth more than $2 billion.
Record had been spun out of Allco and ran commercial office properties in Australian capital cities and in the US and Germany. However, it was still managed by the now-failed finance combine through Record Funds Management (RFM).
PPB sold the corporate shell of RFM last October as part of its efforts to recover money for its creditors, the largest of which was Allco Finance, which itself collapsed into receivership under a mountain of debt.
The sale of RFM was fought over by former Allco executives and the winning purchaser was a small Sydney asset management group called One Investment, whose managing director, Frank Tearle, had held several senior jobs at Allco Finance.
The under-bidder was a consortium headed by Record Realty's former chairman, Robert West, who was at the helm of the trust when its bankers appointed receivers last April.
PPB has yet to complete its work on the failure of RFM but it is understood creditors are unlikely to receive a pay-out of any more than 5 in the dollar.
They, though, are in a better position than Record Realty's shareholders. The stock was suspended from trading in February last year and then delisted at the end of August.
''[We] have reasonable grounds to believe there that is no likelihood that unit holders will receive any distribution in the course of the administration,'' the joint administrators, Neil Singleton and Tony Sims, told them in letters sent on Wednesday.
RRT Price at posting:
0.0¢ Sentiment: Hold Disclosure: Held
