'Worst-case scenario' set to see liquidation of Mount Ruapehu ski fields operator

A watershed meeting over the fate of Ruapehu Alpine Lifts (RAL), which went into voluntary administration last year owing $45 million, has seen the business given back to its directors and facing liquidation.

The development follows a meeting of creditors voting down a proposal to save the business operations of the North Island’s two main skifields, Whakapapa and Tūroa.

Thousands of creditors, including lifepass holders, bondholders, mountain staff, the New Zealand Ministry of Business, Innovation and Employment and ANZ Bank, voted on Tuesday on who will take over from the insolvent RAL.

Presented with three options to operate ski fields at the UNESCO World Heritage site and one of the central North Island's biggest employers, voted to return for an option that, failing outside intervention, will see RAL liquidated.

The voluntary administrators' report released last week suggested this option was a "worst-case scenario" as a result of the company being "hopelessly insolvent".

The options presented were:

Resolution A: A proposal by the Ruapehu Skifields Stakeholders Association (RSSA) to retain the business and assets of RAL in the current company structure while creditors either write off some of their debt or extend payment terms.

Resolution B: A 'prepackaged liquidation' backed by the Crown where Whakapapa Holdings Limited (WHL) and Pure Tūroa Limited (PTL) would buy a side of the mountain each for $1 and the Crown would take a 25% shareholding in both entities and loan them money.

Resolution C: Returning RAL to the directors' control, which would lead to them seeking liquidation.

For a resolution to pass it needed 50% of votes by number and 75% by value of creditors, a source at the Auckland meeting said. This meant overcoming the split between the large number of small-value creditors, versus the handful who own most of the beleaguered company’s debt.

The vote ended in a stalemate, with Resolution C the outcome of the watershed meeting.

RAL will now be placed into liquidation on Wednesday when it visits the High Court.

Dave Mazey, RAL's former boss, told Newshub they hope to get a concession from the New Zealand Department of Conservation to still bid to take over even after it goes to the High Court on Wednesday.

It is still unclear whether the mountain will open this ski season.