Chase Manhattan

"Its management team rounded up a good cadre of investors to close the deal. Chase Manhattan would provide senior debt to close the transaction and to provide a development loan to finance future drilling. So HS needed $ 40 million of equity to complete the rest of the deal. Goldman Sachs had agreed to provide $ 20 million of equity capital. We were approached to consider putting in a subordinated debt layer or preferred stock of $ 15 million after another debt provider, Westinghouse Credit, had dropped out. Trust Company of the West (TCW) was also considering making a $ 5 million preferred equity investment."

"*Carters was run by a tough old sawmiller, Alwyn Carter, and his two sons. I remember going to their offices and persuading the old man to convert to the Chase Prime Rate, but the boys stepped in. They’d had a long-running fight with my brother Ian over pulp and paper equipment and were keen to take out their frustrations on me. I remember them laughing at me: ‘You’ve got your balls in a knot, Gibbsie, you’ll lose some money; what a joke, ha ha ha.’ ‘All right, you bastards,’ I thought. I went back and told my staff to look at the loan contract and if there is any infraction, the slightest irregularity, we’ll call in the loan. And sure enough, not long after they were one day late with an interest payment. I called in the loan. They went berserk. No one else would lend them money, since no one could make any profit lending money under the conditions Muldoon had created. The Carters got on to Chase Manhattan in the US: here they were with the top credit rating in New Zealand, and this little bugger in Auckland* *was calling in their loan! I got reverberations from Australia but nobody stopped me. It was one of those satisfying victories, going back to the Carter brothers and saying, ‘Tough titties, boys: pay up.’ And they did.*"