Lenders Now Own New Zealand’s Metro GlassTech

New Zealand glazier Metropolitan Glass & Glazing, or

Sankaty Advisors, an affiliate of Bain Capital, Deutsche Bank and J.P.Morgan Special Opportunities are among a consortium of senior lenders which controls 60% of the company following a debt-to-equity swap worth around 180 million New Zealand dollars (US$146 million). Australian private equity firm Crescent Capital Partners owns the remaining 40%.

Catalyst Investment Managers bought Metro GlassTech in July 2006 for around NZ$350 million from its founders. According to the Overseas Investment Office, Macquarie Investment Management owned 15.4% stake of Metro GlassTech.

The New Zealand Government’s Overseas Investment Office released a decision dated Jan. 27 allowing for the creditors of Metro GlassTech, and its parent company, NZ Glass Holdings, to take control of both companies’ assets. NZ Glass Holdings breached financial covenants in 2011 giving rise to certain rights for the company’s creditors, the Overseas Investment Office said. It has since been placed into liquidation by KordaMentha.

In its financial statements for the year ended Mar 31, 2011 lodged Feb. 28 this year, NZ Glass Holdings directors Andrew Bailey and Trent Peterson said a syndicate of investors had bought the company’s only asset Metro GlassTech.

“The restructure of the company’s shareholdings and capital structure was necessitated by a continuation of the downturn in the residential new build market which has endured since mid-2008,” the directors said, describing the downturn as extreme, and compounded by the series of earthquakes in the Christchurch region.

Mr. Bailey and Mr. Peterson, who have since resigned, added they expect the company to continue to operate in a challenging environment in the medium term, with debt levels more appropriate for market conditions.

“The board is confident that Metro GlassTech is well positioned to recover in-line with an improvement in the residential building market in due course, as well as the rebuild of the Christchurch region,” they said.

For the year to March 31 2011, the business recorded a loss of NZ$200 million, four times worse than its NZ$48 million loss the year prior. The company had net liabilities of NZ$126.4 million compared to net assets of NZ$74.5 million the year prior.