Racking Up Debt

18 Aug

I am very pi#!ed at the moment.  An idea I had a few years ago,  is even less possible now.  It is most likely the biggest hindrance would be the debt Holdco have across the group.  Holdco would probably collapse without EIL and EIL’s assets.

The debt situation probably won’t improve either.  This Holdco constitution change (2 August 2016) has now been lodged with Companies.

2aug

Here it is

part 1 const

part 2 const

It was previously 10%.  And remember it is GROUP assets.  Interesting that the current council ‘chicken little’d the Better Local Services reform package as taking away their ability to control the CCO’s.  Here they are doing just that all on their own.

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UPDATE:  It has, and rightly so, been suggested that I specifically point out the differences.  ICHL only needs shareholder permission for a major transaction.  A major transaction is, under the amended constitution defined as 15% of GROUP assets.

The old constitution defines a major transaction as

major

The old one is not talking about GROUP assets.  The definition of assets being GROUP assets is new.  It is my understanding that ‘the company’ is Invercargill City Holdings Ltd (ICHL) in the old one.  Now it is the company AND ITS SUBSIDIARIES ASSETS.

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I am very curious to know who voted for this?  I will put in a request today.

Dunedin’s holding company has, since appointing new directors, reduced debt by $9M.  The last three years or so have been very scary times with regard to our holding company.  What debt does ICHL currently have?

 

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3 Responses to “Racking Up Debt”

  1. Phil T August 18, 2016 at 10:44 am #

    Your point around EIL is the most important one people should think of. EIL has a captured marker and only has to raise the cost of a unit of electricity a fraction to make their books look good. Such companies are sought after in other countries because of that very reason. In normal commerce its about competition and performance but utility companies have a much easier way to turn a profit. That is what underpins the whole ICC CCO setup and without EIL the others would have folded years ago. Forestry is not a good investment and all we hear is the one day in the future excuse and the others are much the same. Invercargill residents have propped these companies up for years for what?
    Dean Johnston in todays Times dismisses a persons concern about the ICC competing with private developers by talking about a return in 2020 I think it was but the thing is it wont matter one iota to him if that return is never achieved. He has no personal risk if it does not achieve the return forecast. We need a council that understands commerce rather than think it knows more than the private sector.

  2. Phil T August 19, 2016 at 9:01 am #

    The Regional Council sees no need to interfere in the running of the company they own 66% of and surprise surprise it runs extremely well
    https://nz.finance.yahoo.com/news/south-port-posts-another-record-040800343.html

    • Kylie August 19, 2016 at 9:21 am #

      I remember from last election though, one candidate thinks that should change. I believe they still have to ability to appoint up to two directors but choose not to. Kudos from me.

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