Labour wants Shipley to stand down
Labour has called for Genesis Energy chairwoman Jenny Shipley to stand aside while legal action against her is pursued.
BDO, the liquidators of collapsed construction firm Mainzeal, have filed a civil suit against Shipley and the other former directors, seeking an undisclosed amount.
In a statement, Shipley’s lawyer Michael Arthur said the claim alleged a breach of directors’ duties but she would be defending it ‘‘vigorously’’.
‘‘It will take some weeks to review the claim and file a defence, but Dame Jenny and others strongly deny any allegation of wrongdoing.’’
Calls to some of the other directors, including Clive Tilby, former chief executive Peter Gomm and Martinborough-based Sir Paul Collins were not returned.
Labour’s State Owned Enterprises spokesman Clayton Cosgrove said Finance Minister Bill English and Revenue Minister Todd McClay must step in to protect the integrity of Genesis Energy while the case against its chairwoman continued.
‘‘The accusations against Jenny Shipley are deeply concerning. It is not tenable for her to remain chairperson or on the board of Genesis Energy while Mainzeal liquidators file a civil lawsuit against her for her alleged role in the collapse.’’
Cosgrove urged the Government to explain why it had confidence in Shipley’s leadership if it did not ask her to stand aside until all legal issues were resolved.
‘‘This is about doing the right thing to protect the interests of taxpayers and shareholders.’’
However, English said he had not ‘‘seen anything that would require the action Mr Cosgrove is suggesting’’.
‘‘All directors are expected to discharge their duties to a high standard.
‘‘With regards to the Genesis board, our view is they’ve
All directors are expected to discharge their duties to a high standard. Bill English Finance Minister
performed well – and one of the benefits of the Government Share Offer is that the performance of the board is now subject to market scrutiny,’’ English said.
New Zealand-based litigation fund LPF Group confirmed that it was the third party underwriting BDO’s legal costs.
Mainzeal was one of the country’s biggest construction firms before it collapsed in 2013, initially owing unsecured creditors an estimated $138 million. That amount grew to $151.3m as a number of related companies also came under the liquidator’s control.
Mainzeal was owned by Richina Global Real Estate, whose sole director is Auckland businessman Richard Yan. Its other directors resigned shortly before the collapse.
In its reports, BDO remarked on the convoluted company structure that Mainzeal was part of and the related party transfers that had occurred.