Du Val Group has been placed in statutory management. File picture. Photo: nito500/123RF
- Government puts Auckland property developer Du Val Group and subsidiaries into statutory management
- Minister says group has significant liabilities and affairs complex
- Work to continue on active building projects
- Statutory management rarely used
Authorities have tightened their control of Auckland property investor and developer Du Val Group by having it placed in statutory management.
The government sought orders from the Governor General on the advice of financial regulator, the Financial Markets Authority (FMA), which initially had the group placed in receivership in early August.
Commerce Minister Andrew Bayly said the Du Val group had significant liabilities and its position was so complex and large that immediate intervention was required to prevent broader harm.
"Statutory management is the option of last resort used to deal with complex corporate failure where ordinary insolvency law is inadequate. It is intended to protect investors and creditors from further losses and to enable the orderly administration of a company's affairs."
The rarely used statutory management was applied to four core Du Val Corporations and 20 associated limited partnerships, and 46 subsidiaries. One subsidiary was excluded as it was 50 percent owned by a third party and operates independently of the Du Val Group.
The group was founded and controlled by directors Kenyon and Charlotte Clarke.
The interim receivers from PwC, John Fisk, Stephen White and Lara Bennett, were appointed as statutory managers.
Fisk said the managers wanted construction works to continue on Du Val's active construction projects and business would continue as usual for the rental properties.
"Our initial focus will be to preserve and realise best value for all stakeholders. We will be communicating with all creditors and investors, and will be conducting a thorough investigation."
Last year, the FMA issued a formal warning against Du Val Capital Partners - the investment arm of Du Val - for potentially misleading or deceiving investors.
Statutory management was devised after the 1987 sharemarket crash and has been used sparingly, notably in the aftermath of the global financial crisis in 2009/10 to manage the affairs of several failed finance firms, notably South Canterbury Finance.