February news digest
01 March 2017
The following are summaries of media stories related to business turnaround and insolvency in Australia during February 2017.
1 February 2017
The Australian reports that “a plea by struggling Whyalla steelmaker Arrium to delay an upgrade of the 600MW Heywood interconnector which imports electricity from Victoria was deflected by the South Australian government, despite Arrium’s predictions of skyrocketing prices for wholesale electricity while the link was down. In a July 6 email exchange between Arrium and the energy markets director of Weatherill’s state development department, an executive warned of substantial impacts to the steelmaker in coming days, with wholesale prices already at 400 per cent above normal prices. The cause was the “very bad timing” of the July 4-12 interconnector closure when gas prices were high and low wind conditions were expected, the email said. Electricity reliability has become a major issue for the handful of bidders for Arrium, expected to update their offers by February 15 with a sale of the company due by the end of March, a KordaMentha spokesman said.”
1 February 2017
In the Black reports that “at a time when most people are winding down, Lorraine geared up for a fight to right the wrongs of a proprietor and a bureaucracy that didn’t seem to care. In October 2009, Allan Lorraine FCPA secured a place for himself and his wife at Mentone Gardens, a Supported Residential Service (SRS) in Melbourne. At the time, he was purely focused on his wife’s wellbeing. “I wasn’t bad enough to go in myself, but my wife was and I didn’t want her in there alone. I knew what could happen in those places to vulnerable people.” Pleased his wife Rose was settling in well to their new accommodation, Lorraine wasn’t at all expecting the exploitation of Mentone Gardens residents he was soon to uncover. In June 2013, the management of Mentone Gardens called a meeting, summoning residents and relatives. The 50 or so unsuspecting people who filled the residents’ lounge were addressed by a voluntary administrator who announced the company was going into liquidation.“
1 February 2017
The Daily Advertiser reports “Douglas Aerospace is back painting planes in the hangar it was forced to vacate after defaulting on a building loan from ratepayers. Regional Express (Rex) has licensed the hangar to Douglas Aerospace for their paint activity from the very first day of Rex’s involvement and will continue to do so going forward. As recently as December 2015, council general manager Alan Eldridge threatened to lock Douglas Aerospace out of the building if its staff didn’t vacate voluntarily. The Wagga-based plane refurbishment outfit, which went into voluntary administration after a legal stoush with the Albury-based hangar builder, is well and truly back up and running.”
1 February, 2017
The Straits Times (Singapore) reports that ”there will soon be greater cooperation and communication for cross-border insolvency proceedings. On Wednesday (Feb 1), a new set of guidelines will be officially implemented between Singapore's Supreme Court and the United States bankruptcy court for the district of Delaware. More jurisdictions are expected to follow suit. The guidelines serve as a roadmap for how courts communicate. For instance, in appropriate situations, joint hearings involving the different courts may be held, although each court will retain its independence and impartiality, said Singapore's Supreme Court in a media release on Wednesday.”
2 February 2017
The Sydney Morning Herald reports that “the collapse of national fashion brands Marcs and David Lawrence has added another 1130 workers to the retail rout that claimed close to 2000 jobs in the sector before Christmas. And retail insiders claim the rot that took down Payless Shoes and Pumpkin Patch in December has spread to Australia's upmarket, national fashion chains and warn of more pain to come. Insolvency insiders say a number of retailers have reached out to them in recent weeks as rising costs and slowing sales push them to the brink. Brand Collective chief Martin Matthews said he'd be very "surprised" if more retailers didn't hoist the white flag in coming months after Marcs and David Lawrence faltered under close to $30 million in debts.”
2 February 2017
The Australian reports that “Bankwest, the Western Australian lender acquired by Commonwealth Bank in 2008, has shelled out almost $5 million to customers after it failed to link offset accounts to customers’ home loan accounts. The breach, which was discovered by Bankwest after ANZ dished out a $70m for similar issues nearly three years ago, affected around 11,000 customers who had open offset accounts with Bankwest between 2007 and June last year. Bankwest reported the breach to the Australian Securities and Investments Commission, and has repaid $4.9m to customers. Bankwest retail boss Andrew Whitechurch said 95 per cent of refunds amounted to less than $1000 each.”
3 February 2017
The Sydney Morning Herald reports “Clive Palmer's wife has been called to give evidence into the collapse of his Townsville refinery company, Queensland Nickel. The Federal Court order summoning Anna Palmer to answer liquidators' questions came after a similar directive was issued to the former politician's nephew, Clive Mensink, and just a week before the hearings were due to resume.”
4 February 2017
The Western Advocate reports that “Independent Senator Jacqui Lambie has accused unnamed figures within the NSW RSL of trying to drive out the league's CEO Glenn Kolomeitz, who has spearheaded the recent efforts to reform its finances and investigate past alleged improprieties. Senator Lambie, a former soldier who is pushing for improved veterans services, posted on Facebook a defence of Mr Kolomeitz and suggested that "bullying" was going on inside the organisation. Mr Rowe is being investigated by police over $475,000 he spent on his RSL credit card over a six-year period, including more than $200,000 while also paying for mobile phones for five family members. Fairfax Media can reveal Mr Rowe withdrew $5200 in cash in one month around the end of 2013, including $2300 in 17 days over the Christmas and New Year period in his home town of Armidale, according to a forensic report by auditors KordaMentha.”
4 February 2017
The Newcastle Herald reports that “a Wickham-based power retailer, Urth Energy, has gone into voluntary administration, putting more than 20 people out of work and stranding an estimated 800 electricity customers. Urth Energy, which billed itself as a "boutique" energy retailer focusing on solar energy systems, appointed Newcastle insolvency expert Brad Morelli, of Jirsch Sutherland, as external administrator on Wednesday. As a result, the Australian Energy Regulator suspended the company from operating in the national electricity market on Thursday. The regulator’s acting chair, Cristina Cifuentes, said customers had been transferred from “the failed electricity retailer” to other suppliers to ensure their electricity supply continued without interruption.”
6 February 2017
The West Australian reports that “Australia’s biggest independent phone retailer, Allphones, has gone into administration, affecting hundreds of staff from more than 80 stores across the country. The ABC reported the write-off came a year after Optus, which also owns the Virgin Mobile brand in Australia, withdrew Optus and Virgin products from Allphones stores. It’s understood staff were briefed on the news this morning, according to the ABC. In a statement to News Corp, PPB Advisory confirmed it had been appointed voluntary administrator of Allphones.”
7 February 2017
The Australian Financial Review reports that “less than a week after the collapse of fashion chains Marcs and David Lawrence, two more high-profile apparel brands - Herringbone and Rhodes & Beckett - have fallen victim to changing consumer tastes and increasing competition. Bruno Secatore, Daniel Juratowitch and Luke Targett of Melbourne-based advisory and turnaround firm Cor Cordis have been appointed voluntary administrators of Herringbone Pty Ltd and Rhodes & Beckett Pty Ltd. Both chains were majority owned by van Laack Australia, the local subsidiary of 136-year old German suit maker van Laack. Mr Secatore told The Australian Financial Review on Tuesday the businesses would be put up for sale and loss-making stores would be closed as soon as possible, with unsold stock moved to remaining stores.”
7 February 2017
The National Business Review (NZ) reports that “some 7500 investors left out of pocket by Capital + Merchant Finance will get their second payment next month, almost a decade after the lender collapsed. Receiver Brendon Gibson of KordaMentha told investors a second distribution of $2 million will be made next month, taking the total returned so far to $12 million, or 7.2c in the dollar, in his latest report. A third payment is expected to be made once the receiver's final claim is completed, although a potential rival has emerged for that money which Gibson said the receivers are investigating.”
8 February 2017
The Australian asks “which Australian corporations are poised to restructure their businesses this year? History shows those that do so tend to overshoot fair value estimates and outperform the broader market, according to Swiss investment bank Credit Suisse. The firm’s head of Australian equity strategy, Hasan Tevfik, has compiled a list of 17 ASX-listed corporations he says are likely to report a restructuring expense this year.”
8 February 2017
Seatrade Maritime News reports “beleaguered Singapore shipping trust Rickmers Maritime says it is evaluating two alternative restructuring plans after noteholders voted against its original plans in December. Rickmers Trust Management said it had been in discussions with financial and legal advisors from groups of holders its SGD100m notes due in 2017. “The Trustee-manager has discussed a preliminary framework for an alternative proposal from Ferrier Hodgson, the financial adviser representing a group of noteholders, and is presently seeking clarification on such proposal,” it said in a statement the Singapore Exchange.”
8 February 2017
The Advertiser (SA) reports “a home builder that has left behind a trail of unfinished and poorly built homes has temporarily halted trading as it investigates the location of company documents and the potential misuse of funds, a court has heard. Disgruntled customers and unpaid tradesmen of Softec Homes gathered in the Federal Court yesterday to hear the Mawson Lakes builder had temporarily ceased trading amid concerns over missing financial documents and transfer of company funds to other parties without the direction of managing director Furqan Baig.”
8 February 2017
The Border Mail reports that “the former director of liquidated coach and trailer manufacturer Brimarco has fronted the Ballarat Magistrates Court. James Meaden, of Invermay, appeared on Wednesday charged with a director’s duty offence under the Corporations Act. The Commonwealth Director of Public Prosecutions is prosecuting the matter and are alleging Meaden dishonestly transferred $34,000 to gain advantage for himself or someone else before the business he was the director of went into liquidation.”
8 February 2017
Elle Magazine reports that “after filing for bankruptcy last year, online store Nasty Gal will be granted a new lease on life, thanks to an anticipated acquisition from Boohoo.com. The British online retailer is reportedly on the verge of bringing Nasty Gal under its wing, after its bid for the company, pegged at around $20 million USD, was accepted by default. Boohoo is expected to close the deal and sign all the dotted lines in the coming few days.”
9 February 2017
The New Zealand Herald reports “creditors have placed failed crime-fighting software company Wynyard Group into liquidation, the company announced today. KordaMentha partners Grant Graham and Neale Jackson, who were running the voluntary administration, of Wynyard have been appointed liquidators of the company and subsidiary Wynyard (NZ) Limited. The liquidators will provide further reports to creditors as required under the Companies Act and noted the act prohibits any transfer of shares in Wynyard without the approval of the court.”
9 February 2017
The Canberra Times reports that “subcontractors fear they could be out of pocket by tens of thousands of dollars after ACT-based construction company SMI went into administration on Tuesday. The company, whose financial strife leaves several government projects unfinished, went into receivership by accounting firm RSM Australia Partners and left subcontractors uncertain they would be paid for their work and materials.”
9 February 2017
The Courier Mail reports that “the State Government is holding devastating evidence that the Linc Energy contamination at Chinchilla is far worse than originally believed. As legal action against former directors and major shareholders of the company gets under way, The Courier-Mail has been told the damage is now far greater than the original 175sq/km swath of southern Queensland farmland that allegedly sustained “irreversible, widespread contamination’’, some of which may have been potentially carcinogenic and capable of asphyxiating humans and animals, if exposed.”
9 February 2017
The Australia Financial Review reports that “it's six days out from Arrium Australia binding bids and the big boys (and girls) are back in town. After six months’ diligence and hundreds of meetings with Arrium management, government, unions, customers and the like, Arrium's auction hammer will fall on February 15. In preparation for final bids, it is understood heavyweight executives from the respective camps are back in Australia this week, wanting one final round of site visits and other top level talks before putting a binding number forward. Morgan Stanley is running the sale on behalf of Arrium administrator KordaMentha.”
9 February 2017
The Financial Review reports that “in less than a decade Bellamy's had gone from a Tasmanian family run business to the poster child for Australian success in China as it took advantage of surging demand for foreign infant formula which became known as "white gold". Then, disaster. In the days after Bellamy's Australia admitted in a vaguely worded statement to problems in China, the infant formula maker hurriedly established a war room in the Melbourne offices of law firm Herbert Smith Freehills. The company's "business update" delivered on December 2 last year had wiped half a billion dollars from its sharemarket value and as its problems grew, so too did those around the war room table on level 43 of 101 Collins St.”
9 February 2017
Queensland Country Life reports that “receivers are expected to return to a Pentland grazing property this week to take possession of a Prairie family’s last remaining property. Rabobank’s receivers, Ferrier Hodgson, took possession of Lloyd and Noelene Bradshaw’s 7,395.53 hectare (18,275 acre), Laurel Vale, 10km from Prairie, last week. The bank denies it has acted improperly and receivers are expected to arrive at the family’s 8, 215 ha (20,000 acre) Ballabay, 20km northwest of Pentland, to attempt to take possession.”
9 February 2017
Malaysia’s Sunday Mail reports that “Stone Master Corp Bhd’s external auditors Messrs Baker Tilly Monteiro Heng (BTMH) has expressed a qualified opinion in the company’s audited financial statements for the financial year ended Sept 30, 2016 (FY16). As at Sept 30, 2016, Stone Master’s current liabilities exceeded its current assets by RM12.5 million and RM12.12 million at the group and company level respectively, with accumulated losses of RM23.6 million and RM33.69 million each. This indicates the existence of a material uncertainty, which may cast significant doubt about the group’s ability to continue as a going concern, said the external auditors. The company had on Dec 14, 2016 engaged Ferrier Hodgson MH Sdn Bhd to conduct a review of the allegations by SC against the company’s deputy managing director of the RM11.54 million, which was subsequently paid by local subsidiaries of the 23 foreign companies to the company’s deputy managing director’s personal account. The investigation is still ongoing.”
9 February 2017
The Dairy Farmer reports that “troubled milk broking company National Dairy Products (NDP) will now go into liquidation. Deloitte joint and several administrator Glen Kanevsky said NDP had informed him a deed of company arrangement (DOCA) had been withdrawn, nor would there be a revised document. “There won’t be a DOCA proposal, presented to creditors, at the reconvened meeting,” Mr Kanevsky said. “There is no proposal, it’s going to go to liquidation.””
10 February 2017
SmartCompany reports that “retail chain Howards Storage World will emerge from voluntary administration, with administrators Deloitte securing a sale of the business and its franchise network to an unnamed buyer. The business was placed into the hands of external managers in late 2016, with Vaughan Strawbridge and David Lombe from Deloitte appointed to manage the administration of four entities in the Howards Storage World group in early December. The business continued to trade throughout the voluntary administration process. At the time, the group was operating 29 company-owned retail outlets in New South Wales, Queensland, South Australia and Victoria, while also wholesaling goods to a network of 30 franchised Howards Storage World (HSW) stores, of which it is the franchisor.”
10 February 2017
Fully Loaded reports that “Wastech Field Service (WFS) is now under the control of PPB Advisory administrators. The deadline for expressions of interest is today. The move comes just five weeks after parent Wastech Engineering put the Tieman Tail Lift and Whiting Door divisions it bought in 2015 up for sale. That Tieman brand has reportedly already been sold to new business Tuffman and Whiting Door to Southern States Group.”
10 February 2017
The Australian Financial Review reports “it's midday Thursday and financial services worker Dave Smith* has popped into Rhodes & Beckett's flagship store in Sydney's Martin Place to buy a new belt. He leaves empty handed, despite a 25 per cent-off store-wide sale, baulking at the $170 price tag, and heads towards H&M and Zara, knowing he'll be able to pick up a serviceable belt at a fraction of the price. "I'd read that Rhodes & Beckett had gone into administration and I thought I'd come and take a look," Smith tells AFR Weekend. The owner of Rhodes & Beckett and stablemate Herringbone appointed administrators on Tuesday, less than a week after the collapse of Marcs and David Lawrence.”
10 February 2017
The Australian reports that “after securing one of the nation’s biggest recoveries of missing tax money, insolvency practice Sheahan Lock Partners has outlined a plan it believes could enable the federal government to pocket billions of dollars in extra recoveries from tax avoiders. John Sheahan, whose firm is in line to recover $125 million for the Australian Taxation Office, has had discussions with Malcolm Turnbull about unleashing a new wave of well-financed litigation against tax avoiders.”
11 February 1 2017
The Australian reports that “there is something seriously awry inside Australian retail. Behind the inviting smiles of sales assistants folding and refolding garments in clothing stores across the country, business models are under pressure and collapsing at a rate not seen for years. What started as a trickle a month out from Christmas with the failure of children’s fashion label Pumpkin Patch and the demise of Payless Shoes — one of the nation’s largest independent shoe retailers — gathered strength by New Year’s Eve as Howards Storage was also tipped into administration. Ferrier Hodgson partner James Stewart is one of the nation’s leading retail corporate doctors and over 30 years has tended to the lifeless bodies of many failures such as the Dick Smith chain of electronics shops as well as the high-profile failures of Harris Scarfe and Borders.”
12 February 2017
The Australian Financial Review reports that “United Kingdom steel and commodities firm Liberty House has vowed to be a long-term owner of the Arrium steel assets and the Whyalla steelworks if its bid is successful, and foreshadowed those operations may eventually find themselves listed on the stock exchange in the UK. Liberty is partnering with stablemate SIMEC and is one of the serious bidders for the Arrium Australian operations, and aims to buy all of the remaining assets rather than try and cherry-pick the more sought after east coast steel distribution and mini-mill operations. Liberty and SIMEC would be disciplined in their bidding in the sale process conducted by administrators KordaMentha.”
12 February 2017
The Border Mail reports that “a fitness college network that has been promoted by Biggest Loser star Steve "Commando" Willis has gone into voluntary administration following the federal government's crackdown on the vocational education sector. Administrator Ferrier Hodgson, which has taken over three of Australia's largest collapsed colleges, Phoenix, the Australian Institute of Professional Education and the Australian Careers Network, has been called into the Sage Institute of Fitness empire to put together a deed of company arrangement.”
12 February 2017
The Courier Mail reports “Peter Dinoris has faced threats of death and bashings during his 23-year career at the coalface of corporate failure. Now the veteran liquidator – who recently opened his own firm, Artemis Insolvency – is expecting more corporate pain in the coming year, especially in the troubled construction sector. “Construction is a very difficult game because it is so cyclical,” said Mr Dinoris, who was the liquidator for Gold Coast building company Glenzeil in 2014. “Any return to creditors is seen as a success because, in many cases, they get nothing.””
12 February 2017
The Australian reports that “some of Australia’s biggest listed companies including Cimic, Macquarie Group and Spotless have been hit by the fallout of the delays to the construction of the new Royal Adelaide Hospital. The public-private partnership consortium behind the hospital has called in insolvency firm McGrath Nicol after costly delays to the $2.23 billion hospital has placed them at the mercy of their lenders. The SA Health Partnership Consortium that includes builder Hansen Yuncken, Cimic’s construction arm CPB Contractors, the listed catering company Spotless and Australian banking group Macquarie are believed to owe a syndicate of at least 20 financiers more than $1 billion.”
13 February 2017
The Australian reports that “the voluntary administrators of failed menswear chains Herringbone and Rhodes & Beckett have been forced to close seven stores as a buyer is sought for the fashion brands. The closures will mean the loss of 10 jobs at the loss-making chains, which are owned by German retail group van Laack and which collapsed into voluntary administration last week. Three Herringbone stores and four Rhodes & Beckett stores are being closed. Neither brand will now have a physical presence in Perth, with 10 staff in the city unable to be redeployed and so made redundant. The group now has 22 stores and 136 staff.”
13 February 2017
The Age reports that “bankrupt mining magnate Joseph Gutnick will face a public grilling over his bankruptcy affairs as early as next month. Mr Gutnick has been issued with a summons to appear at the Federal Court to allow his trustees in bankruptcy to question his financial affairs. The former Melbourne Football Club president's wife, Stera Gutnick, and son, Mordechai Gutnick, will also be called for examination. Mr Gutnick told Fairfax Media: "Looking forward to telling my side of the story. Didn't get a chance in court."”
14 February 2017
The Courier Mail reports that “ex-staff of a prominent Mooloolaba restaurant will only receive about 13 cents for every dollar of superannuation they’re owed by former boss Todd Young. The Sunshine Coast Daily reported Mr Young hit Las Vegas with his partner just days after winding up Todd Young Investments Pty Ltd on December 29, 2015. His company operated Bella Venezia restaurant at Mooloolaba through a trust. Bella Venezia Group Pty Ltd was registered on October 8, 2015 by Kristine Ruth, and is today business name holder of Bella Venezia. Facebook posts show the restaurant, Bella Venezia Restaurant and Bar, is open for business.”
15 February 2017
ARN reports “Brisbane-based IT services provider and independent software vendor (ISV), 2Sol Software, has come back from the brink after going into administration owing hundreds of thousands of dollars to creditors. The IT software and services company was founded in 2002 and has made a name for itself creating websites and developing software systems for businesses in a variety of industry verticals, including the travel, mining, education and health sectors. It was placed into voluntary administration on 20 December, with Brent Kijurina from Hall Chadwick Chartered Accountants appointed as administrator, and fellow Hall Chadwick partners, Richard Albarran and Shahin Hussain, coming on as joint appointees.”
15 February 2017
The Australian reports “liquidators have been appointed to an Australian arm of multi-billion-dollar Chinese developer R&F Properties, the international company that swept into the Australian market vowing to buy $500 million worth of sites. An order to wind up R&F Mega Property, an Australian subsidiary of the Hong Kong-listed and Guangzhou-based R&F Properties, was issued in the Victorian Supreme Court on February 1, The Australian can reveal. Associate Justice John Efthim ordered R&F Mega Property be wound up in insolvency and appointed Deloitte partner Robert Woods as liquidator. R&F Mega Property did not attend.”
15 February 2017
Money Management reports that “the Australian financial services licence (AFSL) of Sovereign MF has been cancelled by the Australian Securities and Investments Commission (ASIC). Sovereign is the responsible entity for The Sovereign Tarneit Land Fund and The Sovereign Aged Care Property Fund, and its AFSL was cancelled on 8 February 2017. "The cancellation is subject to a specification under section 915H of the Corporations Act that the AFSL continues in effect as though the cancellation had not happened for a period of 24 months to allow the liquidators to provide financial services that are reasonably necessary or incidental to the winding up of the schemes," ASIC said.”
15 February 2017
Sourceable reports that “if you walk around any construction site across the country, it’s immediately apparent that sub-contractors are the backbone of Australia’s building and construction industry. They enter into contracts, do the work and have a fundamental legal right to be paid. But in this industry, all small business owners are routinely subjected to lead contractors refusing to pay, the unpaid debt now totalling $20 billion annually! By its very definition this is fraudulent. Under Australian law it’s definitively illegal. And it’s also criminal.”
15 February 2017
The Advertiser (SA) reports that “disgruntled customers of an Adelaide home builder have celebrated a court ruling to wind up the northern suburbs company paving the way for insurance claims to finish their homes. Federal Court Registrar Nicholas Parkyn yesterday ordered Softec Homes be put into liquidation after finding that the Mawson Lakes company - which the court heard owed at least $350,000 to creditors - was insolvent. Customers, some of whom have waited more than four years for their homes to be completed, yesterday hugged in the public gallery after the decision. The ruling means that the customers can now seek insurance claims to help complete their homes.”
15 February 2017
Domain.com reports “a Brisbane property belonging to former coal billionaire, the now bankrupt Nathan Tinkler has been slashed to less than half of what he paid for it. The 4.05-hectare block, located in the hillsides of one of Brisbane’s most exclusive semi-rural areas at Pullenvale, is now listed with a guide price of $795,000. Mr Tinkler, who became Australia’s youngest billionaire at the age of 35, was declared bankrupt by the courts last year, barely a week after he turned 40.”
15 February 2017
The Queensland Times reports that “subcontractors are banking on negotiations now under way to protect them from the worst of another major collapse in the Queensland construction industry. Bloomer Constructions Pty Ltd closed a number of building sites across Brisbane last week, ahead of what was expected to be an announcement Tuesday morning about the company's fate. Instead, Wayne Bloomer, who founded the company in 1983 and is its executive director and chief executive officer, has been locked in a series of negotiations with clients and subcontractors in a bid to see projects completed and the workforce paid.”
16 February 2017
The Queensland Times reports that “Andrew Schwartz of AS Advisory is one of two administrators called in to handle the liquidation of Terry White Chemists and Priceline in Stockland Rockhampton. Mr Schwartz advised he and Matt Adams of FTI Consulting were appointed this morning, and have since been in discussions with other parties who may be interested in acquiring the businesses.”
16 February 2017
The Sun-Herald reports that “thirteen David Lawrence and Marcs fashion stores will close and 20 staff will lose their jobs as administrators hunt for a buyer to save the troubled retailers. Marcs and David Lawrence have both gone into administration. Picture: Tara Croser. Geoff Reidy, director of Rodgers Reidy, says the decision was made after a review of the businesses placed in voluntary administration on February 2. Nine David Lawrence stores and four Marcs outlets will close by February 21 and 10 full-time staff and another 10 part-time staff will be made redundant.”
17 February 2017
The Sydney Morning Herald reports that “an elevated Wheelers Hill super-site until recently occupied by the Sage Institute of Fitness, which went into voluntary administration last week, has sold to a China-based builder for a speculated price of more than $20 million. The 1.7-hectare block at the north-west corner of Ferntree Gully and Jells roads, has a flexible General Residential zoning, and is now expected to be replaced with a medium-density village containing hundreds of new dwellings.”
17 February 2017
ARN reports that “performance management, business intelligence, and diagnostic software company, Integrated Research (ASX:IRI), has reported on the ASX, a “record” first half year result for the six month period ending 31 December 2016. The company reported a profit after tax of $7.7 million for the period, a 25 per cent increase when compared to the same time last year. Its new license sales increased by 22 per cent to $23.9 million, and its total revenue was up 10 per cent to $43.3 million. The company said, in a statement, that all its product lines, including unified communications (UC), contact centre, and consulting services, recorded growth and that Avaya’s Chapter 11 motions do not change the company’s financial outlook. Avaya is a customer and distribution channel partner of the company.”
17 February 2017
The Weekly Times reports that “National Dairy Products’ administrators may pursue the milk company’s owner Tony Esposito for $4.3 million in “voidable transactions” if it is forced into liquidation next week. In a report sent to creditors this week, NDP administrators Glen Kanevsky and Salvatore Algeri, of Deloitte, identified $4,343,339 in voidable transactions that could be recovered from Mr Esposito — but only if the company was placed in liquidation. The administrators recommend to creditors that NDP be wound up, given that Mr Esposito and director partner Violetta Esposito have withdrawn the Deed of Company Arrangement that would have seen creditors get $521,000 to settle debts of up to $17.8 million.”
20 February 2017
Logistics Magazine reports “months of speculation over the fate for shipping company Hanjin Shipping came to an end on Friday when a South Korean court declared it bankrupt. Hanjin’s fall from grace from one of the world’s top 10 shipping companies to today has shocked the global cargo movement industry in its speed and finality. Hanjin’s troubles first emerged in August 2016, when it was revealed that the company had debts of US$5.4 billion ($7 billion) and creditors would not give any more money. Hanjin – then South Korea’s biggest shipper and number seven in the world – went into receivership and applied for court protection.”
21 February 2017
The Financial Review reports “PPB Advisory has lost two partners from its Sydney corporate insolvency and structuring team. Street Talk understands that Brett Lord and Marcus Ayres have left the firm, and are likely to pop up elsewhere in the local restructuring market in coming months. Lord is understood to be headed to Ernst & Young. Lord was well known in for working on a number of high profile jobs including as receiver of BBY Ltd in 2015, Provident Capital and Lehman Brothers Real Estate Commercial in 2012. Ayers worked on the Australian arm of Lehman Brothers and the likes of Provident Capital and pubs group J&J O'Brien, among other clients. It comes as insolvency firms including PPB re-shape their business models for the future.”
21 February 2017
ABC News reports “the Australian Taxation Office (ATO) has been ordered to refund more than $1 million it took from failed South Australian company Penrice, after being sued by the company's liquidators, the ABC can reveal. The soda products maker collapsed in 2014 with debts of up to $200 million, leaving 100 staff out of work. In the lead-up to its demise, Penrice paid the ATO more than $1.2 million. Liquidators McGrath Nicol sued the ATO and the Federal Court has ordered the money be repaid.”
21 February 2017
CRN reports that “Kogan has won its claim with liquidators Ferrier Hodgson, finally laying the controversy surrounding the demise of telecommunications distributor ispONE to rest. Kogan advised shareholders today that Ferrier Hodgson had awarded Kogan $692,414 in its claim against ispONE, four years after the company was liquidated. The company stated in its FY2016 results that it was still owed $293,320 from the claim. As a result, the difference of $399,094 will be added to Kogan's profit in its 2017 financial results.”
22 February 2017
Nine News reports that “a septuagenarian being chased for millions in unpaid debts to a Slavic charity in Melbourne has been locked up by police after also facing allegations of cultivating cannabis. Boris Trajkov helped set up the Victorian Multiethnic Slavic Welfare Association, which ran services for elderly Slavic people as well as the multicultural Lalor Childcare Centre, back in 1994. The 76-year-old was made secretary of the association in 2012, and according to a writ filed with the Victorian County Court in December, was the only authorised signatory of the association's bank account. The association has been in liquidation since March last year, with its liquidators now pursuing Trajkov for nearly $3.5 million in unpaid debts.”
23 February 2017
The Australian reports that “the Australian arm of multi-billion-dollar Chinese developer R&F Properties is threatening legal action against a former creditor after its court-ordered liquidation order was lifted. R&F Development Holdings has engaged high-profile lawyer Leon Zwier, a partner at Arnold Bloch Leibler Lawyers, to “pursue its legal rights” over the stoush, as it announced it would implement new systems to improve communication and track invoices. The Australian revealed last week that the Supreme Court in Victoria issued an order to wind up R&F Mega Property and appointed Deloitte as liquidator on February 1, following action by creditor Metropolis Agency. Mr Zwier said the court should not have been asked to wind up a solvent company, “let alone one which is owned by a multi-billion-dollar parent”.
23 February 2017
The Morning Bulletin (Qld) reports that “creditors will meet next week to discuss debts owed by former mayoral candidate Michael McMillan's business. Mr McMillan, who is now working in North Queensland in public relations, purchased the Stockland Rockhampton Coffee Club franchise back in 2009, but sold late last year. The creditors will meet with liquidators Deloitte in Brisbane on February 28. Deloitte's lead partner for restructuring services, Richard Hughes, said the business was forced into involuntary administration due to unpaid taxes.”
24 February 2017
Sight reports that “Family Christian Stores, which filed for bankruptcy protection two years ago, has announced it is closing after 85 years. The Grand Rapids, Michigan-based company employed more than 3,000 people in 240 retail sites across 36 states. It was considered the world’s largest retailer of Christian-themed merchandise. “We had two very difficult years post-bankruptcy,” said Chuck Bengochea, company president, in a statement. “Despite improvements in product assortment and the store experience, sales continued to decline.” Mr Bengochea said the nonprofit company was not able to work out terms and pricing with its vendors that allowed it to compete in the market successfully.”
24 February 2017
ABC News reports “Phoenixing companies, which costs the Australian economy billions of dollars a year, is too easy, cheap, lucrative and is largely invisible, according to a new report into the practice. Phoenixing occurs when a company's directors strip cash and assets from it, hide them, liquidate the company and then restart it, usually under a different name. Like the mythical bird, the company rises from the flames. This is done to deny creditors, including the Australian Taxation Office, money owing to them.”
26 February 2017
The Daily Telegraph reports “Johanna Johnson Pty Ltd is still under administration but that hasn’t stopped the disgraced wedding dress designer from not only registering two new businesses, but allegedly opening a bricks-and-mortar store. Johnson — whose dresses are still available to buy online for up to $5000 despite the fact numerous brides missed out on receiving their gowns after the designer’s last company went broke — has taken to social media to announce she has opened new headquarters on Bondi Beach.”
27 February 2017
News.com.au reports “it was not so long ago that seemingly every commentary on the Australian economy referenced it simultaneously running at two speeds. As the folk of the country’s resource-rich outback towns enjoyed the abundant rivers of cash the mining boom flooded upon them, the country’s traditional economic powerhouses, Victoria and NSW, stagnated with high interest rates and the high Australian dollar. Half a decade or so on, the economic duality continues. Only now, it’s in reverse but the pain in the regions has been much more severe than anyone could have anticipated. “95 per cent of our sales are bank repossessions,” said Bella Exposito, a real estate agency owner in the Queensland coal heartland of Moranbah.”
27 February 2017
SmartCompany reports that “to stamp out illegal phoenix activity, directors should be required to have identification numbers. And, if they’ve had many corporate failures, they should be classed in a new probationary category, our research shows. These are a few of several measures we have designed to detect and pre-emptively disrupt those bent on using company liquidation or deregistration to avoid payment of debts—before they do harm. When it comes to stamping out such illegal phoenix activity in Australia, a primary focus on prosecuting those who have done the wrong thing has not been successful.”
27 February 2017
ABC News reports “property owners say they feel betrayed and have lost thousands of dollars after Victorian building company Watersun Homes was placed into voluntary administration. Rodgers Reidy in Melbourne was appointed as administrator for Watersun Homes on Tuesday and said the company did not have the funds to continue trading. The insolvency firm said 90 full-time staff at the company had been told they had lost their jobs, and 300 building projects across the state were now in limbo.”
27 February 2017
Lexology reports that “on 21 December 2016 the Federal Government announced a national review of security of payment laws in the building and construction industry. Mr John Murray AM has been appointed by the Federal Minister for Employment to conduct the review, which will consider the disparate approaches taken to security of payment laws across Australian jurisdictions. Following a push by crossbenchers in relation to the passing of the Building and Construction Industry (Improving Productivity) Bill 2016, a Security of Payments Working Group (SPWG) was established to monitor issues in security of payment for contractors. Security of payment issues in the construction industry have also been noted as a concern by other reviews and inquiries such as the recent Senate Economic References Committee Inquiry into Insolvency in the Australian Construction Industry, which found that security of payment laws across jurisdictions were not working as effectively as intended.”
28 February 2017
The Financial Review reports that “the superannuation industry wants the government to cover any outstanding entitlements when a company goes broke but bureaucrats warn it is a bad idea that will cost $800 million over the next four years. Super funds have called for an expanded taxpayer-funded safety net as part of a Senate inquiry into non-payment of the 9.5 per cent super guarantee. The existing Fair Entitlements Guarantee covers owed wages for bankrupt and insolvent companies but it does not extend to super.
28 February 2017
The Great Lakes Advocate reports that “debt collector and undischarged bankrupt Adam Kazal has been jailed for criminal contempt after a judge found he "deliberately and very publicly" defied court orders. Although Kazal's Twitter account claims that "revenge is sweet and not fattening" his pursuit of vengeance against a former business partner has seen him imprisoned for 18 months. Justice Steven Rares of the Federal Court found that Kazal, 50, had deliberately flouted court orders that ordered him to stop making defamatory comments about businessman Rodric David, who was once a business partner of the Kazal family.”
28 February 2017
Accountancy Age (UK) reports “Andrew Tate, president of insolvency and restructuring trade body R3, and a partner and head of restructuring at Kreston Reeves, examines the government’s proposed changes to the UK’s insolvency and restructuring framework, and highlights the profession’s concerns.”
28 February 2017
SmartCompany reports that “a small business owner has opened up about the difficulties of managing cashflow in a growing business, after his personal training company Rapid Personal Training entered liquidation yesterday. Insolvency firm Hogan and Sprowles has been appointed to manage the liquidation of Rapid PT, which employs three full-time staff and 17 contractors, and has seven locations spread across Sydney and Perth. The business has ceased trading.”
28 February 2017
Reuters reports that “a year ago, Peabody Energy Corp's (BTUUQ.PK) chief executive was presiding over $2 billion of losses as the world's largest private sector coal miner spiralled into bankruptcy. Now, CEO Glenn Kellow and other top executives stand to reap tens of millions of dollars in stock bonuses under Peabody's bankruptcy exit plan, which sets aside 10 percent of newly minted shares for employees.”
28 February 2017
The Australian reports that “as uranium producers welcome the rally in the price of the nuclear fuel from its 12-year lows in December, a recent $US6.3 billion write-down of Toshiba’s nuclear reactor construction business — which has the Japanese company teetering on the verge of bankruptcy — is testament to the one big challenge that may stymie a renewed push for nuclear power in developed economies: cost.”
28 February 2017
The Australian reports “Dick Smith says Coles and Woolworths are threatening to take some of his products off the shelves because they cannot compete with a French rival, and high power prices are stopping him from cutting production costs to compete. Mr Smith’s range of fruit spreads and OzEmite are made by Adelaide family-owned company Spring Gully, which has seen power prices double from $85,000 to $150,000 this year. Dropping the spreads from supermarket shelves would be a crushing blow for Spring Gully, which has spent the past four years paying back creditors after going into voluntary administration in 2013.”