South Canterbury Finance preference shares are reported to touch their record low level, holding a financial adviser behind the plunge. The Company has claimed that the financial adviser has told the clients that it will strive to get a new main investor, which consequently nudged the shares down.

Its preference shares marked a 39% fall, slipping to 10 cents from 16.50 cents recorded yesterday.

Following the sudden plunge, the NZX was made to deliver a ‘please explain’ letter to South Canterbury.

Chief Executive Sandy Maier responded that he was well versed with the fact that a financial adviser was writing to the clients with the shares and claiming them that the Company’s recapitalization plan is likely to collapse.

Maier responded by saying, “South Canterbury Finance confirms that positive discussions are continuing with parties who remain interested in participating in the proposed recapitalization of the Company”.

South Canterbury is not guided under the statutory management, while its investors are shielded by the Crown's extended deposit guarantee scheme. But, the preference shares are not included under the guarantee scheme.

South Canterbury had been in the lime light since the preceding month, as it was unceasingly rolling over its investments. Over the June quarter, the firm had been successful is redeeming over $50 million in outstanding debts.