CAUTIOUS RAPTIS REVEALS HIS VISION FOR REVIVAL

CAUTIOUS RAPTIS REVEALS HIS VISION FOR REVIVAL

RAPTIS Group (ASX:RPG) is all but certain to start trading within the next six months with the backing of company founder and chairman Jim Raptis.

Raptis, the company's major shareholder, says he is fully prepared to support the proposed $1 million share issue that will provide working capital to get the company's first project under way.

Raptis tells Gold Coast Business News that, as major shareholder, he is underwriting the share issue and that the company will be back in business regardless of the outcome of the stock offering.

"This way we can give investors a chance to participate," he says. "We have to be operating within six months."

Pricing of the share issue has not been set, and some market commentators say it is likely Raptis will have to take up the entire entitlement as underwriter due to an expected underwhelming demand for the stock.

Raptis says the greatest lesson learnt from the collapse of the Raptis Group in 2008 is diversification, with the company at the time largely focused on high rise apartments and hotels on the Gold Coast.

"We'll be restructuring the board and we'll be looking at expanding our business across south-east Queensland," he says.

Raptis also says debt management is vital in the post-GFC era. He says high rises are not on the agenda and that the company will take a conservative approach to all new projects.

He has identified the first development for the group, but will give no further details. He would only say that the project is located along the Gold Coast coastal strip.

Despite Raptis Group remaining dormant for the past six years, operating through a deed of company arrangement (DOCA) struck with creditors, Raptis himself has been undertaking projects in his own right.

His son Evan Raptis teamed up with former Raptis Group staffer George Mastrocostas and, through company Emandar, they have been involved in a string of low-rise apartment projects over the past five years. Emandar has had considerable sales success with its projects at a time of undersupply in the affordable end of the market.

Raptis is also understood to have good relationships with financiers thanks to a solid post-GFC development record.

Raptis says the delay in relisting Raptis Group has been due to an ongoing battle with the Australian Taxation Office which claimed it was owned $29.3 million in GST payments related to the development of Chevron Renaissance more than a decade ago.

A legal win by Raptis last year has seen that tax bill whittled down to just $6. Had the ATO won, it would have been entitled to become a creditor to the company and a participant in the DOCA, diluting potential benefits to existing creditors.

Under the planned resurrection of the company, creditors have been promised 40 million shares as part of a debt-for-equity swap agreed to in the DOCA, which has been administered by Brian Silvia and Andrew Cummins, of BRI Ferrier, since early 2009.

Meanwhile, Raptis says the Gold Coast property market is in a good place at the moment.

"It's the most stable market I have seen in 20 years," he says.

Raptis says while Sydney is overheated, and Melbourne and Brisbane are running strong, the Gold Coast has found an equilibrium of supply and demand that bodes well for a new-look Raptis Group.

The company will target small scale projects with modest price points to capitalise on strength in the affordable end of the market, he says.

Enjoyed this article?

Don't miss out on the knowledge and insights to be gained from our daily news and features.

Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.

Support independent journalism and stay informed with stories that matter to you.

Subscribe now and get 50% off your first year!

Four time-saving tips for automating your investment portfolio
Partner Content
In today's fast-paced investment landscape, time is a valuable commodity. Fortunately, w...
Etoro
Advertisement

Related Stories

Luxury fashion seller Azura hits profitability as AI plugs data gaps

Luxury fashion seller Azura hits profitability as AI plugs data gaps

An artificial intelligence (AI) overhaul has allowed Azura Fashion ...

“Not our desired outcome”: Telix withdraws from $300m Nasdaq IPO

“Not our desired outcome”: Telix withdraws from $300m Nasdaq IPO

Telix Pharmaceuticals (ASX: TLX), one of the nation’s largest...

CommBank joins new ‘intelligence loop’ to combat SMS phishing scams

CommBank joins new ‘intelligence loop’ to combat SMS phishing scams

In an effort to reduce the number of SMS phishing scam victims...

‘Gone the long yards’: Luxury boatbuilder Maritimo a stayer in local manufacturing

‘Gone the long yards’: Luxury boatbuilder Maritimo a stayer in local manufacturing

In an era when Australia’s mass-production car industry is a ...