“South Pacific Growers Ltd received a $13 million Government loan from the North Island Weather Event Fund in December 2023,” an MBIE spokesman said.
“The fund was set up specifically to support recovery in the wake of Cyclone Gabrielle.
“It was designed to help businesses get back on their feet and re-engage with commercial lenders.”
With respect to repayments, he said the loan terms were “commercially sensitive”.
The appointed receiver, BDO Auckland, confirmed that from what it could see, none of that loan had been repaid.
The $13 million debt has been included under unsecured creditors in the receivers’ report.
“It appears unlikely that any funds will be available for distribution to unsecured creditors,” the report stated.
Sykes has been contacted for comment.
The company was operating from 2020 until it ceased trading recently.
It did not own any land, but leased 32 orchards totalling 191ha.
“The company suffered damage to orchards and equipment due to Cyclone Gabrielle [in February 2023],” the receivers’ report read.
“The director made efforts to raise capital and obtain recovery funding, to restore affected orchards and sustain the company through a recovery period towards full production.
“However, funding obtained and crop proceeds were insufficient to operate the company effectively and as the company’s cashflow problems worsened, it became unable to pay its debts when due.
An overseas creditor (and part shareholder of the company), Pacific Wick Ltd, is owed almost $6m and appointed the receivers.
Other creditors include well-known Hawke’s Bay companies Bostock NZ (owed about $580,000) and Rockit (owed over $2m), according to the report.
Employees are owed about $5000 in accrued annual leave.
The report did not include the value of the company’s assets, which can help pay debts.
“At this stage, it appears likely that after realisation of all assets, shortfalls will remain owing to secured and preferential creditors,” the receivers’ report stated.
Assets to be auctioned
An auction has been set for Thursday, September 17 to sell the company’s assets.
That includes the likes of tractors, trailers, sprayers, forklifts and other goods.
The auction will be run by Ritchie Bros through Ironplanet.com.
Hawke’s Bay grows about two-thirds of New Zealand’s apples, most of which are exported overseas.
Companies relying on the industry have also been hit hard by the fallout of Kiwi Crunch, another large apple grower and exporter in Hawke’s Bay that is in turmoil and has left a trail of debt.