King cuts a deal with creditors

Roped in ... Michael King has creditors who appreciate polo.

MFS LIMITEDS founder and polo enthusiast, Michael King, has dodged bankruptcy after striking a deal with his creditors for more than $130 million of debts.

Last month Kings creditors quietly agreed to a two-year personal insolvency agreement with the founder of the financial group, which collapsed last year

owing more than $1 billion.

The former MFS chief and his co-founder, Philip Adams, still owe $127.2 million on margin loans they took over their now worthless 13 per cent stake in the company, once worth more than $440 million.

King is nowlocked into an agreement that will require him to make undisclosed payments to his creditors.

Good luck. According to documents filed to the insolvency trustee, Kings assets

include a laptop and iPod music player (worth a collective $800) and somewatches and a wedding ringworth $2000. The former BRWrich lister also had $60.26

in a Commonwealth Bank account and minus $23,442.51 in another account.

One asset not included in the filingwas a patch of turf King purchased inland fromthe Gold Coast for more than $6 million, which is nowhis polo farm, Elysian Fields.

Given the polo field is held in trust on behalf of King, it would have been out of reach of creditors had the MFS founder been declared bankrupt.

But under the deal struck with creditors last month, the farm has been included. The trustee of the agreement, the Grant Thornton partner Nick Mellos, declined to provide details, noting more information would have been publicly available had

King been declared bankrupt. But he stressed creditors could expect to get more out of King through the deal than if he had been declared bankrupt.

In his original filing to the bankruptcy trustee in April King noted he had flogged his

Mercedes Benz to a used car dealer on the Gold Coast for $43,000. There was $231,000 from shares, including a small holding in Fone Zone, and $150,000 for his half share of a holiday house at Mount Hotham that was jointly owned by a

Kate Manka.

It is unclear if it is the same Kate Manka that is married to the former MFS chairman Paul Manka.

Kings (and Adamss) creditors include the Westpac-owned BT Financial ($41 million) and St George ($26 million), NAB ($22 million), CBA($12.6 million), Lift Capital ($13.7 million), Macquarie ($7.5 million), Adelaide Bank ($4.4 million) and the TaxOffice ($15,293).

Numbersman

After the insolvency agreement, a raft of companies owned by King, such as Black Teak Pty Ltd and Elysian Fields Canungra Hotel Pty Ltd, adopted their company numbers (ACNs) as their new names. At least Kings Canungra Property and Subdivisions catchy newname, ACN 097679788, is better than its original name,

Bradmat Sunshine Coast Weed Control Pty Ltd.

King has been replaced as the sole director of all of his business interests by the Gold Coast private eye Michael Featherstone, who was a little cagey to CBD about his new role.

Imnot trying to be rude, I just dont have any comment, he said. He failed to say whether the name changes could relate to King wanting a more reclusive lifestyle.

A former policeman, Featherstone now runs a private investigation and risk management business and recently authored the book, Bullet Proof Your Business.

Pay up or else

Phil Adams, who moved to Dubai in 2007, remains elusive.

Lets hope he keeps up with his bill payments over there. The United Arab Emirates still has debtor prisons for people unable to pay their dues.

Doughnut futures

A solution to the impasse between the John Kinghorn chaired RHG board and a group

of disgruntled shareholders has come to hand.

Lastweek a group of shareholders led by the research firm Intelligent Investor called an extraordinary meeting to oust the former Allco Finance Group chief David Coe as a director at the mangy financial concern formerly known as Rams Home Loans.

Intelligent Investorwants to replace Coe with two of its own.

But given RHG shares three directors (Kinghorn, John McGuigan and Greg Jones) with

Kinghorns other business concern, Krispy Kreme Australia, it might also make sense to merge the two. For one, this could usher in another financial engineering doughnut to compete with Macquarie Bank (aka the Silver Doughnut).

Not musically inclined

JP Morgan has poured coldwater on the latest musical chair rumour in investment banking, pushed along by this column. The talk circulated in CBD yesterday

was that Credit Suisses property banking team of David Dixon, Stephen Burns and Chris Bedingfield could be eyeing some vacant desks at JP Morgan. But

the bankwas quick to respond yesterday, noting the gossip had no basis. Not even one conversation has been held, a senior JP Morgan banker said in

an email.

Without bubbles

In these fiscally challenging times, the advertising sector is particularly alert to how clients may perceive the lifestyles of ad men and women.

Long lunches and snorting cocaine off a hookers backside are definitely not on the cards, let alone billed to the clients. Sowe can understand M&C Saatchi for feeling a tad sensitive about the name of its newc hief beancounter, Jeff Krug. M&C was quick to assure CBD that Krug, who shares his name with a not inexpensive drop of champagne, was fiscally temperate.

It is not the first time an employee at the advertising agency has had a name with the potential to cause embarrassment. When the agency had justwon the ANZ

account, it selected the best suit in the building to run the account and introduced him to the client.

It was only when the bankers gathered round the table to meet him that it dawned on the agencys chief executive that the man chosen for the job was the aptly named Rob Banks. CBD hoped that he didnt.

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