IFLR 1000
The Guide to the World's Leading Financial Law Firms

The insolvency market has been very quiet compared to the peak that was reached in the previous twelve months. "This market this year has not carried through from the momentum gained," comments a leading partner. The statistics in the New Zealand courts for both liquidations and bankruptcy confirm this.

The finance and second tier lending market in New Zealand was devastated by the finance company collapses and the fallout from that is only just coming before the courts now. "Restructuring transactions are likely to be driven by capital structure reorganisations as distressed assets, including finance company assets, are liquidated with more enthusiasm," says one peer. The market has seen the restructuring of South Canterbury Finance assets including Dairy Holdings, Helicopters NZ, Scales Corporation and the residual loan books.

"There are still a range of over-leveraged companies that need to undertake balance sheet restructurings, examples in 2010 were Yellow Pages and MediaWorks, and we expect a few more in 2011," says another practitioner.

Last year also saw a trend emerging whereby international companies selling certain New Zealand companies' assets to strategically concentrate on other markets. Examples include Pernod Ricard selling Lindauer to Lion Nathan to focus on its global brands and Suncorp selling New Zealand Guardian Trust.

Chapman Tripp continues to be a leader in the restructuring and insolvency market in New Zealand. A rival law firm partner comment: "There are two, maybe three players in this market and Chapman Tripp is one of them."

"The team's strength in depth is un-paralleled", says another rival. Peers recommend Michael Arthur as "one of the leaders in New Zealand restructuring... he is a top shelf lawyer".

The team advised McGrathNicol on all aspects of the South Canterbury Finance receivership, which was the largest corporate insolvency in New Zealand in the wake of the financial crisis. The work involved acting on the sale of assets, including significant trading subsidiaries, recovery of loans, various litigation and regulatory investigations, plus all other aspects of a complex receivership.

The collapse of this NZ$1.6 billion ($1.3 billion) empire is the largest failure of a financial institution in the last 20 years and will be one of the most complex and high profile receiverships for several years.

Other notable practitioners include Michael Harper and Roger Wallis. "Michael guided us through a severely complicated insolvency which required government regulation to provide creditor protection," says a client of the firm, adding: "The relationships Michael has with insolvency practitioners enabled him to propose complex solutions because the other practitioners have confidence what he says would be correct."

A client also recommends Wallis: "Roger provided us with hard advice in corporate matters requiring careful judgement at a moment's notice. His willingness to make such calls in the knowledge that it needs to be right makes him a go-to person."

Another highlight for the team was advising PricewaterhouseCoopers on the receivership of the NZ$417 million indebted Strategic Finance companies, which included work on the recovery of loans and investments in New Zealand, Australia and Fiji. This receivership involved unusually complex loan structures and will rank alongside South Canterbury Finance and Bridgecorp as one of the largest failures of a financial institution in New Zealand in the last 20 years.

Minter Ellison "has maybe the pre-eminent insolvency and restructuring practice in the New Zealand market", says a rival law firm. Clients agree: "Innovative work in finding solutions outside of the norm and a technical ability, knowledge and expertise which we think is good as they have ability to bring in the necessary staff with the right expertise," says one.

Leading the team are partners Sean Gollin and Michael Langdon. "Sean Gollin I feel operates at a very high level," says one peer, while one client comments: "Langdon is a good solid operator who is very dedicated to his work."

The team acted for the receivers appointed by a secured party for developers Melview (Kawerau Falls Station) Investments and Melview (Kawerau Falls Station) Development. The six hotel Kawerau Falls Station development in Queenstown, was the largest property development in New Zealand with a value approaching NZ$1 billion.

Another highlight for the team was acting for the receivers appointed by Westpac to four related companies, which between them operated 22 dairy farms throughout the North Island of New Zealand. This transaction involved the largest privately owned dairy farming operation in New Zealand.

Clients appreciate the firm's quick response times: "They would probably be more responsive and proactive than many competing firms. The senior legal executive in Wellington is exceptional," says one.

The Bell Gully restructuring and insolvency team is "very professional" with a "good responsive nature and strong knowledge when providing quality advising", says a client. It continues to be involved with the most significant complex transactions in the New Zealand market.

The past year saw the team advise New Zealand's largest directories business, Yellow Pages Group (YPG), on a major debt and corporate restructuring after the group breached banking covenants in March 2010. The NZ$1.8 billion ($1.5 billion) transaction was the biggest restructuring arising as a result of the global financial crisis and one of the biggest ever undertaken in the New Zealand market.

The deal involved the trading companies and intellectual property assets being sold from the 'old' Unitas and OTPP owned corporate group to a 'new' group that was ultimately owned by YPG's senior lenders and interest rate swap providers. The purchase price was NZ$750 million, leaving approximately NZ$1.05 billion of unpaid debt sitting in the old group without any underlying assets.

One of the firm's "highly competent lawyers" is Jenny Cooper, who "continues to be a leading lawyer in restructuring work", says a rival. Cooper is highly regarded by fellow practitioners as a "good fiery lawyer that is admired and respected".

Another notable highlight was advising Australia & New Zealand Bank and KordaMentha on the trading receivership of Cedenco Foods, one of New Zealand's biggest fruit and vegetable processors.

This NZ$120 million trading receivership contained complexities from operating the business for a long period while carrying out the receivership. By successfully managing the New Zealand and Australian businesses in tandem, the receivers were able to sell for a strong price to ensure secured creditors and most unsecured creditors were paid.

"Buddle Findlay has one of New Zealand's pre-eminent legal teams for corporate recovery and restructuring, renowned for its depth of experience, responsiveness and accuracy," says a long-standing client. "[It] has partners, resources and talent of the highest order. The advice and service is first class," says the client.

With the highly regarded David Perry, considered "the leading restructuring lawyer in the whole of New Zealand without a doubt", leading the team, it has been a busy twelve months. The team's strength in depth also extends to Scott Abel, "another highly rated restructuring lawyer" according to a peer.

The past year's highlight was advising the trustee in respect of the collapse of the NZ$1.8 billion ($1.5 billion) South Canterbury Finance empire. This high profile complex receivership is the largest failure of a financial institution in the last 20 years.

Another notable highlight was acting for receivers of Matarangi Beach Estates, the developer of a resort on the Coromandel Peninsula. This complex receivership required working through Significant Resource Management Act and Health and Safety issues involving the airstrip and golf course, and the future development of the residential resort.

Mayne Wetherell "would be our preferred New Zealand counsel", says a client. The team's "commercial, practical, no-nonsense in approach and clear communication with clients, peers and counterparts" are attributes which clients consistently endorse.

The team "were technically strong in a setting where much of what they were doing had not previously been done in New Zealand." Another client adds: "Partners involved thought through key issues and were generally well reasoned and practical in their application of the law to the situation at hand" and "were able to draw upon international precedent and apply that to the New Zealand legal framework."

The team acted for the Bank of New Zealand as a senior agent and the senior syndicate in relation to the debt for equity restructure of Yellow Pages Group (YPG). The complex transaction ended with the senior creditors taking full ownership of the business. YPG had been the subject of the most highly leveraged acquisition in Australasian history in April 2007.

A debt of over $1billion at the time was written off as part of the restructure. The team used an innovative method to implement the restructure, believed to be a world first, which allowed the banking syndicate to take ownership of the business outside of any court scheme or formal insolvency process.

Continuing the fine relationship with Bank of New Zealand, the team once again acted as a senior agent and the senior syndicate to the GR Media group of companies (TV3 and RadioWorks), negotiating deferred spectrum payment and security arrangements with the government, part of the restructure, which was effected in December 2009.

Simpson Grierson's restructuring and insolvency team has continued to grow from strength to strength throughout 2010 and 2011.

Peers and clients alike recognise the talents of Michael Robinson and Steven Flynn. "With Robinson you would be hard pressed to find a better insolvency litigator anywhere," says one client, while another recommends Flynn: "if there are tiers for lawyers then he would be tier one. He's really, really good, just top shelf."

Last year the team acted for KordaMentha as receivers and ASB Bank as lender to the Herbert Insurance Group and Herbert Securities. The Herbert group operated an insurance brokerage business, providing insurance cover through 30 leading international and local insurers. The Serious Fraud Office has also commenced an investigation into the group's dealings.

The firm has also been busy in the thriving agriculture sector where it advised Westpac as security agent in relation to the NZ$200 million ($167 million) receivership of Crafar Farms.

Another ongoing project for the team is advising the GE Group on issues relating to mortgage loans that a GE lending entity made to home owners, which then invested the loan proceeds in failed property schemes (including schemes promoted by the failed Blue Chip group).

A clear highlight for Kensington Swan last year was its advice to significant trade creditors, in relation to the voluntary administration of companies in the RED Retail Group, including Whitcoulls Group and Borders New Zealand.

"They have always been able to assist us with the required expertise we have needed at the time," says one client, while another adds: "We prefer to work with this firm as they have always provided us with quick, personal and efficient service"

Lowndes Associates are well though of by clients: "The level of expertise and knowledge in relation to Personal Property Security Registry work is to the highest professional standard one could expect," says one. "When you engage Lowndes Associates you know exactly what to expect we have never been let down." Another adds: "They are in the top echelon of legal firms we engage and they will remain at the top of this list."

Last year the team advised the administrators of the Jones Publishing Group on its appeal to the Court of Appeal.

Last year Russell McVeagh acted for the certain banks, as senior lenders in relation to the Yellow Pages Group (YPG) restructuring. The deal was the largest restructure in New Zealand for 2010 in terms of the dollar value of the business and its liabilities. It involved a large syndicated group of lenders.

The team is described as "exceptionally good generally and specifically", by one client. "A firm with great credentials, resource and capabilities"

The DLA Phillips Fox insolvency team has been significantly strengthened in the last year by the appointment of Reuben Woods as a partner. Also, well known partner Martin Wiseman is back to handling insolvency and restructuring matters.

The firm continues to advise the receivers of Dominion Finance Group on all aspects of its receivership, including advising on their appointment, questions of priority with other secured creditors in relation to the loan book, loan work-outs and recoveries, and assessing potential actions against the directors and other parties. The Dominion Finance Group has a loan book of approximately $290 million. As one of the larger finance company failures in recent times in New Zealand, the receivership has given rise to numerous complicated disputes.