Western Bay announces loan book sale to pay debenture holders

By Jennifer Lanning Drey

Eugene, Ore., Sept. 28 - Western Bay Finance Ltd. will sell a substantial portion of the company's loan book to Finance Now Ltd., according to a company news release.

The proceeds of the sale combined with collections to date will enable the company's receivers to pay a first dividend of NZ$0.65 on the dollar. Debenture holders are expected to receive the first dividend by the middle of October.

"Our analysis has led us to the definite conclusion that this transaction with Finance Now represents the best available value for this portion of the loan book," said Grant Graham and Brendon Gibson, Western Bay's receivers, in the news release.

Under the transaction, loans with a face value of NZ$30 million are being sold for NZ$27.9 million cash. The transaction is scheduled to close on Oct. 2.

The transaction is consistent with the receivers' earlier recovery estimate of NZ$0.75 to NZ$0.85 on the dollar, the receivers said in the release.

The timing of further payments from realizations of remaining assets is dependent on the timing of further collections, according to the release.

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