IRG resolves bank covenant breach row

Thursday 20th August 2009

Investment Research Group, the NZAX-listed investment vehicle, has reached agreement with its bankers, following a breach of banking covenants that prevented the company filing annual accounts and led to a share trading suspension.

"We have today signed a letter of offer with our Bank confirming the ongoing funding of the business," King said. "The issue arose due to differing interpretations on the ratio definitions.

"This matter has been resolved and the bank has agreed to a proposal that we presented to them. As part of the agreement, the bank has provided a Waiver of Breach and hence we are now in a position to finalise the annual accounts."

The shares were suspended in early August when the issue first arose and can resume trading once the annual accounts are filed, which will occur "as soon as practical", King said.

King told BusinessWire that neither party had sought to press the issue of fault, preferring to find a way through the issue.

The company still planned to raise $500,000 to shore up its balance sheet, but this was not required "to get these numbers right", King said. Reports earlier in the month said IRG required the additional funds to remedy the breach.

Businesswire.co.nz

Comments from our readers

No comments yet