In addition, South Canterbury Finance (SCF) is completing the consents for an injection of $37.5 million in new equity from Southbury Corporation and Torchlight Fund No 1 LP and replacing a $75 million funding facility from New Zealand Credit Fund.
In a letter to the finance sector, chief executive Sandy Maier described the targets and timetable set by Standard and Poors (S&P) to retain its credit rating as unrealistic and said chasing them would have destroyed value for SCF stakeholders.
Last week, S&P lowered SCF's long term rating from BB to B+ with a credit watch outlook, while its short-term outlook was confirmed at B.
Targets set by S&P included reducing October debenture maturities by $50 million, increasing cash reserves by more than $150 million, progressing the realisation of assets and sourcing additional equity.
Mr Maier said S&P questioned whether SCF had sufficient liquidity to meet its debenture and bond obligations, but he said it was an area where progress had been made.
If the rate of debenture reinvestment and new investments continued at current levels, "there is every prospect that the wall will have been substantially demolished before October arrives".
SCF faced the prospect of $1.13 billion of debentures and bonds maturing during the year, but Mr Maier said smoothing the debenture maturity profile had progressed well.
"At May 31, the holders of $132.9 million of debentures scheduled to mature in coming months had accepted the company's offer to reinvest in new debentures with longer dated maturities."
