Air NZ denies asset strip claims

Old Mar 18, 02, 10:17 pm
Original Poster
Join Date: Dec 2000
Location: Melbourne, Vic., Australia.
Programs: QF Platinum One (LTG), UA Plat IHG Plat
Posts: 5,819
Air NZ denies asset strip claims

Air NZ denies asset strip claims

March 19 2002

Air New Zealand today vowed to mount a vigorous defence against allegations it had stripped assets from Ansett in the dying days of the company last September.

In a statement issued this morning, Air NZ managing director Ralph Norris hit back at claims contained in the latest report to creditors by Ansett administrators Andersen.

In the report, issued yesterday, administrators Mark Korda and Mark Mentha said they were considering legal action against the former Ansett parent company for alleged asset stripping and alleged inappropriate charging of fuel and other operating costs.

Mr Norris said he was disappointed at the revival of the asset stripping claims, which first arose at the time of the collapse.

"We are disappointed to see the Ansett administrators reviving allegations of asset stripping and inappropriate charging after reaching agreement with us to settle all claims between Ansett and Air New Zealand," Mr Norris said.

"The allegations are nothing more than groundless rumours which were circulated when anger over the loss of Ansett was at its peak.

"We refuted them at the time and continue to do so."

Mr Morris said Air New Zealand knew of no grounds for action against the company and would be asking administrators to provide their reasons for advising creditors that the claims justified further investigation.

The administrators report said legal action was also being considered against the Ansett Group of Companies over the payment of bonuses to some executives in August 2001, a month before the airline's collapse.

The administrators were also investigating claims that might be made against the Lindsay Fox/Solomon Lew Tesna syndicate over the aborted sale of Ansett Mark II.

However, they acknowledged that such legal action appeared unlikely to succeed.

In other developments, the report to creditors has warned that Ansett employees might not receive their full entitlements, now the airline will not be sold as a going concern.

The report suggested that contingencies such as taxes and other costs could see the return on employee entitlements reduced from 100 to 92 per cent.

Mr Korda told ABC radio this morning he believed employees should get the full sum.

"However, there are a number of contingencies out there that we can't control, certain taxes and realisation costs," he said.

"If these contingencies arise or we have those realisation issued, it may be less than 100 cents in the dollar."

Meanwhile, the likelihood of Ansett's unsecured creditors, which include frequent flyer point holders, receiving anything appears to have vanished.

If the Tesna deal had gone ahead administrators had hoped to return up to five cents in the dollar to unsecured creditors.

"We also indicated that if the sale did not complete, it was likely that there would be a shortfall in meeting priority payments and there may be no return to the unsecured creditors," the report said.

"This is now the expected outcome."

RichardMEL is offline  
Old Mar 21, 02, 5:06 am
Join Date: Mar 2001
Location: SYD
Programs: OZ*G, VA gold, NZ*G, QF bronze, Former 'bottom-feeder' AC*G
Posts: 5,036
Asset-stripping claims vanish in hasty retreat

By JIM EAGLES business editor
The Australian assault on Air New Zealand took an even more bizarre turn yesterday as Ansett's administrators repudiated comments in their own report to creditors.

Mark Mentha and Mark Korda, of troubled international accountants Andersen, created international headlines when their latest report referred to "potential claims against Air NZ in relation to ... alleged asset stripping".

But yesterday the pair said the furore was the result of misinterpretation of their report.

"Media reports today were inaccurate in interpretation regarding references to investigations progressed since our first report to creditors," Korda said.

"We have found nothing to support the allegations of asset stripping or alleged inappropriate charging of fuel and other operating costs."

Air NZ, which was enraged by the renewed references to asset stripping and other wrongdoing, confined itself to distributing the statement from the administrators and saying it was "pleased to note the correction".

But behind the scenes there was frustration at further negative publicity as a result of the actions of Australian officials.

What the administrators said in their report was:

"The actions of a number of parties are being considered as part of our investigations into possible courses of action.

These include:

* Potential breaches by directors and officers of the Ansett Group of Companies duties in relation to: payment of bonuses in August 2001; accounting policies; sale and leaseback of fleet.

* Potential claims against Air New Zealand in relation to: alleged asset stripping; centralisation of treasury function and sweeping of bank accounts; methods of recording of intercompany loan accounts; alleged inappropriate charging of fuel and other operating costs.

* Potential claims against other parties: advisers and other officers; actions under the Trade Practices Act; set-off of funds held in bank accounts."

A spokesman for the Ansett administrators told the Business Herald that this was merely a report to creditors about the things that Korda and Mentha had needed to investigate in the course of their job.

"It's just a historical record."

Asked why, then, the report referred to "investigations into possible courses of action" and "potential claims against Air NZ" the spokesman said the report could perhaps have been written more clearly.

"I think," he said, "that's why we've had to issue the statement saying say nothing has been found that would justify taking action."
mad_atta is offline  

Thread Tools
Search this Thread