Last ditch attempts by David Mason to rescue his Sacred Hill group failed as he pinned hopes on continuation of a US wine supply contract he claimed was generating annual profits of twelve million dollars.
Sacred Hill Marlborough Vineyards Ltd and Sacred Hill Vineyards Ltd, both controlled by Hawkes Bay vintner David Mason, were pitched into receivership by Westpac in May 2021. Property Law Act notices demanded payment of $53 million by mid-July; precursor to a forced sale by Westpac.
The High Court was told Sacred Hill receivers agreed to sell company assets to Marlborough wine processor, Vinlink Marlborough Ltd for some $41 million. This was a back-up deal, conditional on Mr Mason being unable to refinance the Westpac loan by its mid-July deadline. Same day as the Westpac deadline expired, Mr Mason was in court demanding the Westpac deadline be extended. This would have the result of blocking sale of Sacred Hill assets to Vinlink. The receivers’ sale to Vinlink was at an undervalue, he claimed. It did not include the value of a long-term Sacred Hill contract for the supply of product to a Louisiana company in the United States which in turn supplied the Costco chain, he said. This supply contract had at least five years to run, carrying a potential profit of sixty million dollars over the next five years, he claimed.
Mr Mason claimed to have third party support in hand offering sufficient funding to pay Westpac. Justice Lang ordered the Westpac deadline for repayment extended by two days.
Mason v. McKay – High Court (13.07.21)
21.119
Post judgment note: Two days later, Mr Mason was back in court claiming he had conditional interest from Japanese investors willing to recapitalise Sacred Hill. Justice Jagose dismissed Mr Mason’s further attempt to extend the Westpac deadline saying this offshore expression of interest ‘carries little more weight than the paper on which it is written.’ Companies in the Sacred Hill group went into liquidation three weeks after the extended deadline expired.