Ministers must decide whether to take over Ruapehu Alpine Lifts' $15 million bank debt to stop a fire sale of its assets
If Cabinet and central North Island iwi don't agree to a new bailout to salvage the "hopelessly insolvent" Ruapehu Alpine Lifts from liquidation, then officials warn of a "very real risk" of liquidators selling off the assets.
The Ruapehu Skifields Stakeholders Association and iwi have received last-minute briefings on a new proposal, to go to Cabinet today.
Several iwi have written to ministers demanding a stop to the process, they say, because it prejudges the outcome of the overdue Tongariro National Park Treaty settlement.
"Would you send a disqualified driver to go get some more booze? That's how we look at Ruapehu Alpine Lifts – and you're bringing them back again!" – Aiden Gilbert, Nga Hapu o Uenuku
Te Korowai o Wainuiārua chair Aiden Gilbert, from Nga Hapu o Uenuku, says iwi must have oversight or interim management of the ski fields, alongside the Department of Conservation, rather than handing it to the discredited former operator or new private operators like Pure Tūroa and Whakapapa Holdings.
He tells Newsroom bailing out and bringing back the insolvent Ruapehu Alpine Lifts, whose leadership did the damage in the first place, would in his opinion be foolhardy.
"Would you send a disqualified driver to go get some more booze? That's how we look at Ruapehu Alpine Lifts – and you're bringing them back again!"
READ MORE: * Ruapehu fields not commercially viable, iwi says * Government offers taxpayer millions for Ruapehu buyers * The Detail: Life under the shadow of Ruapehu Alpine Lifts
Like others, he's warning the Government should not make hasty decisions at Cabinet today to hand control to private interests that have done so much harm previously.
"We support a management-style oversight system where iwi are in place to make sure that the values of the mountain are upheld, and they're not spilling 17,000 litres of diesel oil into our drinking water like they did before. I could go on," he tells Newsroom.
Iwi were surprised to learn of the proposal to bring back Ruapehu Alpine Lifts with the management assistance of new private investors like Pure Tūroa. "We're a bit aghast about that. It really didn't hit us until we started poking our nose in and prodding the cow."
The Stakeholders Association says the Cabinet Manual prohibits a government making major and irreversible decisions in the final days before an election. "The process to date has not adequately considered the role of community ownership in allowing skiing to continue in a way that is compatible with the complex environmental, social and cultural context."
"If you don't trust us to manage two ski field operators, it's like you're refusing to give your wife the keys to your car – you're saying you don't trust us to drive." – Aiden Gilbert
Ministry of Business and Innovation officials have acknowledged "longterm commercial interests" of iwi, in Tongariro National Park, that must be resolved through the Treaty negotiations but, meanwhile, they are seeking an interim solution for the ski fields.
There is a risk that Tuwharetoa, the powerful iwi with mana whenua over the north side of the mountain, might mount a legal challenge to this.
But they are running out of options: liquidator John Fisk has warned that despite the strong 2023 ski season, cash reserves are on track to run dry in two months.
- Cabinet ministers are advised to provide Ruapehu Alpine Lifts with a $4.3 million loan to continue operating both the Tūroa and Whakapapa ski fields, in receivership, until the end of March 2024;
- The Government would provide $3.05m to the locally-owned start-up company Pure Tūroa Ltd to purchase and operate ski field assets on Tūroa for three years, subject to being granted a Department of Conservation concession to operate in Tongariro National Park;
- The officials are advising that the Government's regional development agency, Kānoa, buy the company's $15.2m ANZ bank debt for the grand total of $1 – enabling the ski-field operator to be transferred from liquidation into receivership. Without taking that step, officials warn, they have no control over the liquidators selling off assets.
The PwC liquidators say Ruapehu Alpine Lifts had fixed assets with a book value of $53m, at last count. "Given the nature of these assets and their location on Mt Ruapehu, the expected break up sale value of these assets is significantly lower than this figure," they reported.
Even if they could realise $53m in selling those ski lifts and snowmakers and cafe cooking facilities, that wouldn't cover the $75m they owe to MBIE, ANZ and a long list of iwi, councils and private creditors. And that's before factoring in the estimated $100m cost of cleaning the mountain of 70 years of detritus and repairing the residual damage afterwards.
MBIE, as the biggest creditor, has the most say in the future of the company. And it seems officials have had enough of dealing with PwC as liquidators, whom they describe as "too expensive". Instead, they want to appoint Calibre Partners as the receiver, later this month when the ski season ends – and the election has passed.
Staff would then be sent new employment contracts through to March 2024, while further options were considered by ministers in any new government.
Aiden Gilbert dismisses the threat of a sell-off of ski field assets as scaremongering. "Well, who would they sell it to? What are the assets? The ski lifts are overdue for replacement, some time ago."
He says it's time for ministers to take a pause, and reconsider their attempts to salvage the ski fields for the benefit of private operators. "You can't keep pouring money into a dead organisation, and pretending that there is no partnership to give effect to the Treaty."
His message to Cabinet ministers? "Good luck for the elections! Because if you can't do the job, then we'll bring on someone who can.
"You're coming up to a Tongariro National Park settlement, you should be building strong relationships with your partners. Now if you don't trust us to manage two ski field operators, it's like you're refusing to give your wife the keys to your car – you're saying you don't trust us to drive."
