Allied Farmers ‘shocked’ at Hanover activity

Allied Farmers has confirmed that a short time after its acquisition of Hanover assets it became concerned about certain Hanover conduct prior to the purchase, and immediately raised those concerns with regulators.

Monday, November 29th 2010, 12:56PM

Allied Farmers has confirmed that a short time after its acquisition of Hanover assets it became concerned about certain Hanover conduct prior to the purchase, and immediately raised those concerns with regulators.

The Securities Commission confirmed on November 19 that it was investigating the conduct of Hanover, and today the Serious Fraud Office (SFO) also confirmed it was investigating Hanover, with Allied Farmers named as one of the complainants.

"We were quite shocked at some of the activity that took place prior to our acquisition of the assets and immediately moved to alert regulators," said Allied managing director Rob Alloway.

"Our staff have spent a considerable amount of time providing relevant files and interviews to both the Securities Commission and the Serious Fraud Office over the course of the year."

Alloway also expressed surprise at the media release from Hanover last Friday saying it would pursue the payment of the $5 million that Allied refused to pay on the basis of serious breaches by Hanover of the agreement assigning the assets to Allied.

"You really have to wonder why, after all that has happened, and in light of the Securities Commission and SFO enquiries, Hanover would want to reopen this issue," Alloway said.

"Personally, I am aghast that they would have the gall to effectively ask ex-Hanover and United debenture holders for another $5 million, given what we know about the Hanover lending practices and assets."

"We also believe we have further substantial personal claims against former directors and officers of Hanover, including claims arising from breaches of duties, and we will pursue these."

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