The fall of Stonewood Homes
New Zealand’s third-largest home builder, Stonewood Homes New Zealand went into receivership on February 22, owing unsecured creditors $15 million. But what does that mean?
Who owned what with Stonewood Homes?
pany owned by the Chow brothers and finance specialist Clint Webber. The brothers, whose assets include commercial property, hotels and strip clubs, bought the national franchise rights and the Christchurch franchisee.
Since taking over the companies, the trio have cancelled the franchise arrangements with the West Coast, New Plymouth and Blenheim franchisees, effectively cutting Mettrick out of Stonewood.
What collapsed first?
The first sign of the collapse was when the Marlborough branch went into liquidation in August last year, followed by the Hamilton branch in January. Former richlister and Christchurch International Airport boss Jim Boult resigned as a director of Stonewood Homes at the start of February. Weeks later Stonewood Homes and several related companies went into receivership, owing unsecured creditors about $15 million. The companies were part-way through building 110 homes. On Wednesday, Stonewood Blenheim Region and Stonewood Homes New Plymouth, owned and run by Mettrick, went into liquidation.
What does it mean when a company goes into receivership?
Technically a company goes into receivership when it can’t meet its commitments to a secured creditor, which has security over the company’s assets. It often occurs when a company cannot pay staff wages.
How about liquidation?
Liquidation is really the final nail in the coffin. Shareholders may place their company into voluntary liquidation, if, for example, they think it is going nowhere and they may as well sell off assets, discharge liabilities and get back the remainder.
What does all this mean for Stonewood Homes homeowners?
The Registered Master Builders Association has assured customers their homes will be completed if they have a Master Builders Guarantee. The only questions now are: By who? And when?