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Ruapehu Alpine Lifts goes into liquidation

The High Court has appointed PWC's John Fisk and Richard Nacey as liquidators.

The coming days will be pivotal, as the liquidator tries to sell the assets of Whakapapa and Turoa ski areas to two bidders.

It is uncertain whether Department of Conservation concessions to run the ski fields can be transferred to the new owners quickly enough time for it to open in a few weeks.

Since RAL went into voluntary administration late last year, owing about $45 million, Fisk and Nacey have been trying to stitch a deal together to enable the ski areas to continue.

However, two options to take over management of the company failed to gain enough support among creditors at a crucial meeting yesterday.

Fisk said going into liquidation was the worst possible outcome.

"It gives us a very short runway really, we will have sufficient funds to be able to continue to employ people on the mountain for a number of days and in that period we're hopeful... that the Whakapapa Holdings and PureTuroa parties are still prepared to be at the table and ready to consummate a deal," he said.

The time available for the Department of Conservation to transfer the concession was short, but the venture depended on it, Fisk said.

"The time is ticking and we need to be able to give certainty to everyone, so that the season can open, and if the season doesn't open, then unfortunately one season closed probably means that it won't ever open again."

The liquidators would decide on the future of the company and would try to get the best price for Ruapehu Alpine Lifts from the buyer, Fisk said.

He believed all the necessary parties were still on board for a deal.

"Certainly the discussions that I had yesterday, there was still an appetite to do something, so I'm hopeful that will be the case, but I can't guarantee that at the moment."

He hoped the bids from the companies would remain the same and did not expect any last minute bids.

The structure of the deal that had been unsuccessfully put forward by the Ruapehu Skifields Stakeholders Association (RSSA) would become almost impossible under the liquidation framework, he said.

Fisk believed there were more risks with the proposal tabled by RSSA than the other bidders.

"The fact of the matter is that they needed to raise $2 million in working capital and at yesterday they advised us that they had raised $1.1m in working capital.

"Then they were dependent on season pass and life pass holders putting in about $7.5m, together with raising about $2m a year from crowd funding. Now all that creates uncertainty... and it's uncertainty for the creditors as well in terms of when they are going to get paid.

"As opposed to the Whakapapa and Pure Turoa offers where, for example trade creditors would be paid within 10 days of the watershed meeting, in full."

Ruapehu Alpine Lift's directors have asked staff to continue to work.

"I really feel for the staff at the moment. They've been left in a situation again of uncertainty about what is going to happen, and for the businesses in the region that are so dependent on this moving forward. So the sooner we can try and resolve and resolve this, the better for everyone."

The fields could open when the season would usually begin, Fisk said.

"There's a huge amount of work that has gone on over the last eight months to be able to get the ski fields ready to operate and they are ready to go subject to the weather... like the whole country is at the moment. It's not quite good enough for snow to be made or falling and we've got weather coming up that doesn't sound like it's going to be much better."

The cost of shutting down the operation and removing the assets on the ski field would be about $150m. .

If the take-over failed and the ski fields remained closed this winter, the only creditor that might receive money back from the removal and sale of the assets on the mountain would probably be the ANZ, Fisk said.

"Everyone else will miss out. What that means is the two councils that have money there, half a million dollars in one case, that will be a cost imposed on the ratepayer in the region.

"The lines company that provides the electricity will miss out on the power that is paid for, which is significant on the mountain, and that cost will have to be reallocated to their other customers.

"And businesses won't have nearly as much trade as what they would expect if the season opened. The costs of having to remove all the assets would fall on DOC and the taxpayer."

It could take a week or two before the future of the ski fields is known.