Ruapehu Alpine Lifts Goes Into Liquidation | New Zealand
The Ruapehu ski areas are facing an uncertain future as Ruapehu Alpine Lifts (RAL) was placed into liquidation. The appointment of PWC's John Fisk and Richard Nacey as liquidators by the High Court adds further complexity to the situation. The next few days will be crucial as the liquidators attempt to sell the assets of Whakapapa and Turoa ski areas to potential buyers. However, the transfer of Department of Conservation concessions to the new owners remains uncertain, raising concerns about the timely opening of the ski fields in a few weeks.
Background: Late last year, RAL voluntarily entered administration with approximately $45 million in debt. Since then, Fisk and Nacey have been tirelessly working towards a resolution that would allow the ski areas to continue operating. Unfortunately, two proposed management takeover options failed to garner sufficient support among creditors during a critical meeting held recently.
The new Skywaka gondola at Whakapapa ski field. Credit: Whakapapa Ski Field
The Challenges Ahead: Going into liquidation represents the worst-case scenario, leaving a very limited timeframe for the liquidators to secure a deal. The available funds will only sustain employment on the mountain for a few days, during which Fisk hopes that the interested parties, Whakapapa Holdings and PureTuroa, remain committed to reaching a successful agreement. However, the Department of Conservation's ability to transfer the concession quickly becomes vital for the venture's feasibility. Fisk emphasises the urgency, stating that failure to open this season might result in permanent closure.
Liquidation and Future Prospects: The liquidators hold the responsibility of determining the future of the company and obtaining the best possible price for Ruapehu Alpine Lifts from potential buyers. While Fisk remains hopeful that all relevant parties are still willing to proceed, he cannot provide any guarantees at this stage. Fisk expresses a desire for the bids from the interested companies to remain unchanged, ruling out any last-minute surprises.
Challenges with Ruapehu Ski fields Stakeholders Association (RSSA) Proposal: The liquidation framework poses significant obstacles to the proposal put forward by the Ruapehu Ski fields Stakeholders Association (RSSA). According to Fisk, the risks associated with the RSSA's plan outweigh those of the other bidders. Their requirement to raise $2 million in working capital, coupled with a dependence on season pass and life pass holders contributing around $7.5 million, creates uncertainty for both creditors and when they can expect to be paid. On the other hand, the offers from Whakapapa and Pure Turoa promise trade creditors full payment within ten days of the watershed meeting.
Impact on Staff and Community: The directors of Ruapehu Alpine Lifts have urged staff to continue working, but uncertainty looms over their future. This uncertainty also affects businesses in the region heavily reliant on the ski fields' operations. Swift resolution is crucial for everyone involved.
Season Readiness and Consequences of Closure: The ski fields are prepared to open on schedule, pending suitable weather conditions. However, Fisk acknowledges the current weather forecasts do not bode well for snowfall or snowmaking. In the event of a failed takeover and the ski fields remaining closed this winter, only the ANZ bank is likely to recover funds from the removal and sale of assets on the mountain. Other creditors, such as local councils, the lines company, and businesses, will bear significant financial losses. The cost of asset removal, estimated at around $150 million, will fall upon the Department of Conservation and taxpayers.
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