Expensive litigation has been avoided with an out-of-court settlement covering most of $96 million of disputed assets in former financier Allan Hubbard's private Aorangi Securities Ltd.
The Aorangi fund was estimated to be worth $96 million and, along with a separately disputed Hubbard Management Fund, was outside the Government's guarantee scheme which bailed out investors in the $1.75 billion collapse of Mr Hubbard's South Canterbury Finance.
Mr Hubbard's widow, Jean, was to lay claim to $60 million of the Aorangi fund in the High Court this month, but the fund's statutory managers, Grant Thornton, yesterday said an ''amicable settlement'' had been reached and investors would get most of their capital back.
''The process will involve the co-operative realisation of assets, some of which are due to settle during June 2013. Investors' capital will be repaid progressively as funds become available,'' the managers told investors in a statement yesterday.
Aorangi was an interest-bearing investment with the majority of 400 investors, predominantly South Canterbury based, paid quarterly interest payments.
Had the High Court case found in favour of the investors, they could have received almost dollar for dollar back on their investments, but if not, they would only have received about 35c in the dollar, which included 15c in the dollar already paid out, a potential total of just $34 million.
The other separate, private, Hubbard Management Fund was once valued by Mr Hubbard at $83 million, and its fair value of identified assets was set at about $40 million by Grant Thornton. So far, about $12 million in investor payments had been made, with more expected. Grant Thornton's next report on Aorangi is due in late July.
