Voluntary administrators have been called into a major investment of the financial backer of one of the preferred Ruapehu Alpine Lifts bidders, but it says it won’t affect its ability to bid.
Whether it still wants to bid is another matter.
The South Island Office, behind Whakapapa Holdings’ bid to buy the Whakapapa ski field from its liquidators, purchased frozen dessert brand Sara Lee for about $95 million in 2021.
The Australian cheesecake maker went into voluntary administration on Tuesday, with Vaughan Strawbridge, Kathryn Evans and Joseph Hansell of FTI Consulting looking to restructure and potentially sell the business while keeping it operational.
The Whakapapa Holdings bid is driven by local industry veteran Dave Mazey, the ski field boss who merged the two fields when Turoa was last in administration, and South Island Office director Tom Elworthy.
Elworthy is also a director of Sara Lee.
MBIE selected Whakapapa Holdings and Pure Tūroa as the preferred bidders for their namesake fields, eligible for significant government support through a partnership, in part for their financial stability and credibility of their business backgrounds.
Speaking to Newsroom, Elworthy said Sara Lee’s financial troubles didn’t impact at all on the South Island Office’s ability to bid for Whakapapa, “We’ve got a number of entities we’re involved with and different investor groups.
“This is one that’s had a bit of a stumble, but it will come out stronger out of voluntary administration I think,” Elworthy said.
Sara Lee’s sales had held up, but it suffered from inflationary pressures and misfortune, including its ice cream supplier’s factory being destroyed by flooding, the liquidation of its logistics provider and industrial action of its packaging supplier.
Asked if he was still interested in buying the field despite the prolonged, complicated and scrutinised Ruapehu sales process, Elworthy said it was hard to pick.
“We’ve had a change of government, so no one is quite sure what that means.”
When Ruapehu Alpine Lifts was in voluntary administration, the Labour Government offered millions of dollars of support to both of its preferred bidders, Whakapapa Holdings and Pure Tūroa.
An email leaked to Newsroom detailed plans for the Crown to take a 25 percent shareholding in both companies, also providing working capital and further government loans to operate the beleaguered field and pay back unsecured creditors.
That deal would have also seen MBIE regional development arm Kānoa commit to performing and funding scheduled maintenance until the deal was completed.
The total cost of deferred maintenance on the fields is said to be about $25m.
The deal fell through when it didn’t receive enough votes at the company’s watershed meeting, with the company tipped into liquidation instead of being sold.
However, Government support for buyers hasn’t stopped.
Labour ministers signed off on a $3.05m loan to Pure Tūroa to help it buy the ski field earlier this month.
Department of Conservation concessions and related iwi discussions are still up in the air.