September news digest

02 October 2017

The following are summaries of media stories related to business turnaround and insolvency in Australia during September 2017.


AUSTRALIA

PROPERTY AND CONSTRUCTION

Ocean Grove entrepreneur Taylor Dow’s business ends after two years

27 September 2017

The Geelong Advertiser reports that “the real estate venture of high-flying young Ocean Grove entrepreneur Taylor Dow has gone bust two years after it was set up. The Taylor Dow Property Group — which reportedly sold $2 billion in property last year — now has a significant list of creditors. Director Taylor Dow — who masterminded a tea business turning over $10,000 per week in 2014, when he was aged just 17 — put the property group into liquidation last month.”


The Role of Financial Control in Construction Business Success

20 September 2017

Sourceable reports that “in any business, delivering positive outcomes for clients is critical. The building sector is no exception. Good practices on site are what any construction enterprise should be about. This translates into commercial success, however, only when financial aspects of the business are effectively managed. In its December 2015 report, the Senate Inquiry into Construction Industry Insolvency talked of a ‘culture of non-payment’ and an imbalance in commercial relationships. These, it said, were contributing factors behind the sector having a rate of insolvency which was disproportionate relative to the value of its economic output.”


Peter O’Brien Constructions goes into voluntary administration due to millions of dollars owed

18 September 2017

The Western Advocate reports that “regional building company Peter O’Brien Constructions has gone into voluntary administration after being owed $12 million by debtors including a government organisation. The Blayney-based firm owes $5.7 million to creditors including regional subcontractors. A statement released by Mr O’Brien said he and his wife Melissa had been forced to sell their assets.”


Big commission paying property developer folds with $283,000 debts

20 September 2017

The Australian Financial Review reports that “a property selling intermediary which offered commission payments of up to 15 per cent has been placed in liquidation with debts of about $283,000, according to regulatory records. Taylor Dow Property Group, which was based in Port Melbourne, about five kilometres south-west of Melbourne's central business district, folded with assets of about $61,000, according to documents filed with the Australian Securities and Investments Commission.”


More than 500 jobs at risk after Perth companies collapse

7 September 2017

The Brisbane Times reports “two Perth companies working in the construction and electrical sectors have been handed over to liquidators, putting more than 500 jobs in jeopardy. South Perth civil construction and mining services business Brierty was placed in voluntary administration on Wednesday, according to Business News.”


Di Latte family pursues bid to revive Diploma Group

5 September 2017

The West Australian reports that “the family behind the failed Diploma Group and its provisional liquidators are seeking to have the company excluded from a potential wind-up order to attempt a rescue plan. A Federal Court judge is set to rule tomorrow on whether the builder-developer which collapsed last year and 19 other Diploma entities will be placed into liquidation.”


140 Ostwald jobs saved as financial woes revealed

5 September 2017

The Chronicle reports that “more than 140 Ostwald Bros workers who were stood down last week will hold onto their jobs. The administrators behind the struggling civil construction company made the announcement this afternoon after it successfully negotiated with the lead contractors on nine projects. PriceWaterhouseCoopers' Derrick Vickers said the employees were already back at work.”


Society architect Jean-mic Du Buisson Perrine declares bankruptcy owing up to $20 million

2 September 2017

The West Australian reports that “a charismatic Perth society architect and developer who left a trail of disgruntled creditors in his wake has gone bankrupt owing up to $20 million after a costly legal pursuit by construction group Georgiou. Jean-mic Du Buisson Perrine and his wife Mercedes declared bankruptcy on August 16, a day before an appeals court confirmed that they were liable for $1.35 million in bills incurred by their pod-home building company while it was insolvent.”


MINING

Search for buyers for collapsed miner's 15% slice of WICET

30 September 2017

The Gladstone Observer reports that “the administrators of Caledon Coal are hunting down keen buyers of the failed miner's 15% share of Wiggins Island Coal Export Terminal. The administrators said the 14.55% of WICET shares is valued at $81.5 million. The embattled central Queensland miner and part-owner of Wiggins Island Coal Export Terminal was placed into liquidation on July 31.”


MP calls out CSG companies

26 September 2017

The Chinchilla News reports that “federal MP David Littleproud has called out the region's CSG companies, demanding they outline to him their local procurement practices and employee recruitment. Mr Littleproud has taken the hardline stance because he does not want the Maranoa to be seen as the hub for fly-in, fly-out (FIFO) gas workers and has called for greater transparency. "There's been a recent downturn of construction operations, especially with the announcement of a major employer, Ostwald Bros, going into voluntary administration, so I'm calling for all gas companies to outline what they're doing to support our local communities,” Mr Littleproud said.”


Boss Angus Walker quits stricken Empire

25 September 2017

The West Australian reports that “the boss of Empire Oil & Gas has quit, less than two weeks after the company went into administration. Empire today announced that chief executive Angus Walker would leave the company because he believed “the position no longer represented the role for which he believed he was to fulfil when he was hired”. Mr Walker has to serve out a six-month notice period, during which time non-executive director Stuart Brown would “take an active role in managing the ongoing business of the company,” Empire said.”


Stochastic into Liquidation

22 September 2017

Business News WA reports that “oil and gas software developer Stochastic Simulation has gone into liquidation, about five months after it went into receivership, with secured creditors likely to receive about 4 cents in the dollar in a best-case scenario. “


Clive Palmer calls himself as witness in $200m asset freeze case

14 September 2017

The Courier Mail reports that “Clive Palmer has called himself as a witness in his biggest legal challenge yet, to stave off a bid to freeze more than $200 million of his assets. A hearing has begun in the Supreme Court in Brisbane as the taxpayer-funded liquidators of Queensland Nickel attempt to freeze the ex-politician’s assets amid a mammoth lawsuit alleging insolvent trading and breaches of directors’ duties. Mr Palmer is representing himself, but he has hired barristers to appear for his various companies, which are also in the firing line as part of the freezing application.”


Tension at coal terminal talks over Glencore plans

8 September 2017

The Australian reports that “negotiations over Wiggins Island Coal Export Terminal continue to heat up, according to sources, with Glencore’s plans to sell assets linked to the complex said to be creating tension. The global trading house recently placed its Rolleston coalmine up for sale. The expectation is the sale of other adjoining assets is still to come. Glencore ships coal from the Rolleston mine through WICET and the understanding is the assets are owned by the same subsidiary that is liable to pay down the debt in the Queensland-based terminal.”


Whyalla celebrates new ownership for steelworks and bold hopes for its future

1 September 2017

ABC News reports that “Whyalla residents have celebrated the official handover of the South Australian regional city's steelworks to a new owner, which is promising modernisation and a brighter future. Whyalla has faced 18 months of uncertainty since Arrium — its biggest employer — went into voluntary administration owning creditors billions of dollars. But spirits are now high as new owner, the global industrial group GFG Alliance, has taken over and executive chairman Sanjeev Gupta has revealed he and his family have now moved to Australia.”


RETAIL

Former Mackay workers still thousands out of pocket

30 September 2017

The Daily Mercury reports that “six former workers at liquidated Trend Interiors Carpet Court Mackay will end up thousands of dollars out of pocket unless government regulators step in, says the woman tasked with managing the fallout of the failed company. But the company's liquidator BRI Ferrier principal Moira Carter is not optimistic the ASIC will give worker welfare priority, meaning they might not get any of the superannuation payments they are owed from years of work at the tile and carpet company before it went into liquidation in March.”


Dick Smith class action heads to court

29 September 2017

The West Australian reports that “lawyers representing Dick Smith shareholders have launched a class action against the failed electronics retailer and two of its former directors. The lawsuit names the former chief executive of Dick Smith, Nick Abboud and ex-chief financial officer Michael Potts, as well as the company itself. Financed by UK-based litigation funder Vannin Capital, the class action alleges shareholders were blindsided by the publication of “misleading and deceptive” financial statements in 2015 that did not give a “true and fair view” of Dick Smith’s financial performance.”


Toys ‘R’ Us collapse leaves Moose Toys out of pocket: Protecting your business when a distributor falls over

22 September 2017

Smart Company reports that “the bankruptcy of US retail giant Toys ‘R’ Us will have flow-on impacts to one of Australia’s biggest toy brands, with one insolvency expert calling on small businesses to do everything they can to protect themselves against the collapse of distributors. The US arm of Toys ‘R’ Us filed for chapter 11 bankruptcy protection on Monday, with debts amounting to $US5 billion ($6.3 billion), reports Forbes.”


Lessons to be learned from the Toys ‘R’ Us bankruptcy

20 September 2017

The Australian reports that “it’s easy to cite Amazon as the primary cause of the collapse into bankruptcy of one of the world’s largest toy store chains, Toys ‘R’ Us in the US but, while part of the explanation for its demise, there are other elements that provide insights and lessons for Australian retailers preparing for the arrival of the disruptive Amazon juggernaut on these shores. Toys ‘R’ Us, which opened its first toys supermarket in 1957, filed for Chapter 11 protection after an attempt to restructure itself was abandoned after its suppliers and lenders became anxious, with the suppliers refusing to ship products unless they received cash in advance and created a liquidity crisis.”


Homewares retailer Moss River collapses into voluntary administration again, owing $2.6 million: Inside the tough home goods market

20 September 2017

Smart Company reports that “bedding and homewares brand Moss River has collapsed into voluntary administration with 65 creditors owed more than $2 million, just over two years after the business first fell into the hands of administrators in July 2015. The 39-year-old business sells linen and homewares items, and previously went into administration in 2015 when it was then owned by an entity called Residential Homewares.”


144 retailers went into administration in the June 2017 quarter

18 September 2017

Ragtrader reports “retail businesses still face insolvency risks despite new safe harbour laws, according to an insolvency expert. New safe harbour legislation which passed through Federal Parliament last week will be unlikely to settle the personal liability fears of current and aspiring company directors in the retail industry.

Currently awaiting royal assent, the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Bill 2017 amends the Corporations Act 2001 (Cth) and aims to protect directors acting to undertake a company restructure in response to insolvency, where it will receive a better result for stakeholders.”


Wilsonton Shopping Centre still in receivership

15 September 2017

The Chronicle reports that “Wilsonton Shopping Centre staff have confirmed that it is still in the hands of receivers, but plans were progressing to continue the development of the $70 million project. While centre management were unable to confirm a time-frame for the project's completion, they were confident that things were back on track.”


Over 100 jobs have been saved in Minto after Sebel Furniture was sold

8 September 2017

The Daily Telegraph reports that “more than 100 jobs have been rescued at Sebel Furniture’s Minto manufacturing facility after the company was sold to Resero Group. Sebel was in danger of closing after it entered into voluntary administration on June 8. Sebel moved its operations from Padstow to 48 Airds Rd, Minto, a site the size of 10 football fields, in 2014, bringing about 160 jobs with it.”


Big pay day awaits Rip Curl founders

8 September 2017

The Australian reports that “the founders of iconic surfwear brand Rip Curl, Doug ‘Claw’ Warbrick and Brian ‘Sing Ding’ Singer, could be sitting on a $100m bonanza after appointing corporate advisers to lead a sales process of the business. It could also prove a windfall for the unlisted company’s tiny group of loyal shareholders that own just under a third of the global clothing and apparel company, although Rip Curl has gone down this path once before only to pull the plug at the last minute and turn their backs on a $400m sale in 2013.”


SurfStitch clings to hopes of relisting after restructuring

5 September 2017

The Australian reports that “the administrator to failed online surf and sports retailer SurfStitch, John Park, said the desired outcome remains a restructure proposal that would see shares in the collapsed company relist on the Australian Securities Exchange, preserving some value for investors, but this was not a guaranteed outcome. Mr Park said at a press conference this afternoon following the first creditors meeting to SurfStitch that he had already received one draft proposal for a deed of company arrangement to fashion a restructure of the group, and that he expected more to follow in coming weeks.”


LOGISTICS

Transtex placed in liquidation

31 August 2017

Prime Mover Magazine reports that “the Geelong-based Shane Blakeborough Logistics (SBL) and Transtex Logistics businesses have both been placed into liquidation. Forensic accounting firm Rodgers Reidy has been appointed to investigate and collect remaining debt from SBL, while Romanis Cant Consulting is liquidating Transtex. Both companies are owned by Shane Blakeborough, who reportedly took over the Transtex business in 2014 and merged it with his family business, SBL.”


TOURISM and HOSPITALITY

The Tangled Maze liquidation: couples left devastated after weddings cancelled

21 September 2017

The Courier reports that “Ballarat couples have been left with just weeks to re-plan their weddings after a popular Creswick venue suddenly went into liquidation. The Tangled Maze went into liquidation on Thursday last week, but couples were only told of the news on Tuesday. Jay Brokenshow said he and fiancee Megan McGourlay received “the most heartless letter ever produced” with no explanation.”


Nahji Chu: Contrary to the popular mantra, my business failure didn't feel like something to celebrate

19 September 2017

The Brisbane Times reports that “people who say there is no such thing as failure have never either truly failed at anything or had to declare bankruptcy. Failure is not simply a blessing in disguise, a shut door that simultaneously swings open to a new one of superior realm of reward — leading you to think "if only I had failed sooner!".”


Off the boil: Concerns over rich-list caterer’s books raised before company’s collapse

13 September 2017

The Herald-Sun reports that “auditors raised serious questions over the business accounts of Peter Rowland Catering ahead of the collapse of the hospitality empire favoured by the rich and famous. Mr Rowland has lost control of the business responsible for producing some of the ­nation’s most extravagant parties, including Alan Bond’s weddings and James Packer’s 21st birthday party. Peter Rowland Catering, which most recently catered for the launch of the National Gallery of Victoria’s The House of Dior exhibition, was quietly restructured last month amid ­mounting debts.”


‘Winding-up’ bid for Quest Townsville on Eyre franchisee

9 September 2017

The Townsville Bulletin reports that “the company that owns Quest Townsville on Eyre has lodged an application for the winding-up of the former franchisee that ran the hotel. Rest Assured (QLD) Pty Ltd started legal proceedings against Quest North Ward Townsville Tenancy Pty Ltd on August 28. A hearing on the application will be held in the Supreme Court in Townsville from 9am on September 26.”


Owners of The Dunes Port Hughes, home to Greg Norman-designed golf course, spending $2.5 million on estate expansion

6 September 2017

The Advertiser reports that “the once troubled Port Hughes golf course and resort is undergoing a $2.5 million expansion ahead of the potential development of a new clubhouse, function centre and tourism accommodation. Early works are expected to be complete in October on a new 38-allotment subdivision at the The Dunes – the first major expansion since the project was saved from receivership five years ago. Project director Kevin McGuinness said 10 of the blocks had been pre-sold in what he said reflected a renewed confidence in the Yorke Peninsula project.”


Bankrupt owner of Stepping Stone apologises to creditors for $236,000 debt

5 September 2017

The Central West Daily reports that “the bankrupt owner of the failed Orange restaurant Stepping Stone has apologised for leaving creditors with debts totalling $236,974. Tom Grasso closed the Anson Street restaurant in May as the debts mounted and was declared bankrupt on June 27. Orange wineries, suppliers, caterers, a public relations company, Orange City Council, banks and the taxation office have all been hit by Mr Grasso’s inability to pay his debts.”


Qantas, Virgin Australia sever frequent flyer ties with Airberlin

31 August 2017

Australian Business Traveller reports that “Qantas and Virgin Australia are severing their respective frequent flyer partnerships with Airberlin as the German airline continues its insolvency proceedings. Qantas Frequent Flyer members will no longer earn Qantas Points or status credits aboard Airberlin flights with an AB or HG flight number from November 15 2017, or when travelling on a Oneworld codeshare flight when booked on an AB or HG flight number.”


COMMUNICATIONS

Ten takeover tussle heats up as CBS sweetens bid ahead of creditor meeting

19 September 2017

The Herald Sun reports that “US media giant CBS has emerged victorious in a bruising battle for control of the Ten Network after creditors voted in favour of its $40.6 million offer at a meeting in Sydney on Tuesday. The offer was preferred over a rival bid from the embattled broadcaster’s billionaire backers Bruce Gordon and Lachlan Murdoch.”


Inside the Media Law Reforms

15 September 2017

ShareCafe reports that “with the Senate approving the proposed media law changes that will allow the country’s remaining publishers, TV and radio stations to marry in haste and lose money (and repent) at leisure, a bankruptcy hearing in far-away Anchorage, has relevance to what will happen in Australia. There this week a judge raised the question why buy a failing business as he approved the sale of Alaska’s largest paper, the Alaska Dispatch News for $1 million. It is a question investors and employees of these companies in Australia should be raising at every opportunity, along with the old Latin dictum Cui bono - who benefits.”


Interactive Telecoms to enter liquidation after Telstra commission wrangle

7 September 2017

ARN reports that “Telstra reseller, Interactive Telecoms, is likely to enter into liquidation today, following the closure of the business in early August. The company’s joint administrator, Ian Purchas, told ARN that Telstra withheld a "significant payment" after terminating its licensing agreement with the reseller. The New South Wales-based company entered into voluntary administration on 2 August and ceased trading on 4 August, immediately after Telstra terminated its licensing agreement with the company.”


Queensland services provider liquidated with $1M in debt

4 September 2017

ARN reports that “Queensland-based Soma Information Technology, which traded as Soma IT, has entered liquidation owing over $1 million to creditors. The company was registered with the Australian Securities and Investments Commission (ASIC) in May 2014, and offered IT business support. The business had been sold prior to the appointment of the liquidators, according to documents lodged with Australia's corporate regulator, which outlined the content of a meeting of the company's creditors on 31 July.”


EDUCATION

Complex Institute of Education leaves students in limbo

26 September 2017

Herald Sun reports that “a major security industry trainer has hit financial trouble — leaving hundreds of students in limbo. Complex Institute of Education, which has six campuses across Victoria, has suspended classes. It is a leading trainer of security guards, airport security screeners, hospital patient transfer officers and hospitality workers. More than 2800 students undertook Complex’s courses in two years. It employs almost 100 people.”


HEALTH

Two Gladstone region medical centres enter administration

8 September 2017

The Observer reports that “creditors will decide the fate of a Gladstone and Calliope health service provider after it entered voluntary administration this week. Australian Securities and Investments Commission documents show the owner of Gladstone Valley and Calliope Medical Centres, Medifield, was placed in the hands of creditors on September 4. The filings were made ten days after the unexpected closure of Calliope Medical Centre, which was believed to be a result of a lack of doctors.”


INVESTMENT

Jackman declares bankruptcy, needs legal aid

28 September 2017

The West Australian reports that “the former director of the collapsed Rare Coin Company has declared he is bankrupt when facing charges he allegedly stole $1.8 million from investors before his company collapsed four years ago. Robert Colin Jackman made brief appearance in the Albany Magistrates Court today facing 36 counts of stealing cash from 20 investors after a lengthy investigation by the Major Fraud Squad. The court heard the amount allegedly stolen totalled $1,819,530 from September 2011 to July 2013 before the company went into liquidation.”


Committed projects in the Townsville region create 4700 jobs

16 September 2017

The Townsville Bulletin reports that “fears of a looming skills shortage in Townsville have been supported by analysis showing projects under way or starting within the next 18 months will create more than 4700 jobs.

Economist Colin Dwyer has provided the analysis which shows if additional “potential” projects such as Adani’s Carmichael mine and Boston Energy and Innovation’s battery factory proceed, a further 4800 jobs will be created. Mr Dwyer said he didn’t think the region was prepared for such a rapid turnaround from its current position of high unemployment.”


Nant whisky founder's wife to be interviewed by ASIC over failed investment schemes

14 September 2017

ABC News reports that “the wife of the bankrupt founder of the Nant whisky and angus cattle investment schemes will be interviewed by the corporate watchdog as part of an ongoing investigation into the saga, the ABC's Background Briefing has learned. Margaret Batt, who replaced her husband Keith Batt as a director of various Nant businesses before he declared himself bankrupt in late 2015, was told on Tuesday that she would have to answer questions from the Australian Securities and Investments Commission (ASIC) in Brisbane.”


SMALL BUSINESS

Australia needs new insolvency laws to encourage small businesses

29 September 2017

The Conversation reports that “the Ten Network’s recent experience of voluntary administration and subsequent rescue by CBS demonstrates how insolvency law works for large Australian companies. But 97% of Australian businesses are small or medium size enterprises (SMEs), and they face a system that isn’t designed for them. 60% of small businesses cease trading within the first three years of operating. While not all close due to business failure, those that do tend to face an awkward insolvency regime that fails to meet their needs in the same way it does Network Ten.”


Printhouse group under liquidation

26 September 2017

ProPrint reports that “Melbourne based offset printer Printhouse Group is into liquidation after 11 years of business. John Zaharopoulos, managing director was unable for comment. Printhouse Group comprised of five staff members. ProPrint understands the company has sold the business prior to appointment of liquidators, and applied for creditors’ voluntary liquidation.”


Cab driver says devaluing of taxi licences has left him on the brink of bankruptcy

11 September 2017

The Age reports that “Andrew Thompson sits on his single bed in the front of a factory in Melbourne's outer southeast. The cavernous unheated space, with its makeshift kitchen and bathroom, is home for the father and taxi licence owner – at least for now. Mr Thompson's real home is long gone, sold in a forced auction when he couldn't meet the repayments. A $670,000 debt hangs around his neck like "a noose".”


Perth contractor into liquidation

6 September 2017

Business News WA reports that “Balcatta-based electrical, fire and security services provider Global Electrotech has gone into liquidation after creditors appointed DCS Advisory to the failed business, which owes about $1.2 million. “


LEGAL

Angry Culleton bundled out of court after outburst in front of magistrate

28 September 2017

SBS reports that “former One Nation senator Rod Culleton has been bundled out of a Perth court by a policeman after he threw his eyeglasses in the magistrate's direction but was allowed back in and later apologised. Culleton has been on trial in Perth Magistrates Court this week, charged with stealing, and represented himself. He allegedly prevented bank-appointed receivers from leaving the Narrogin property of farmer Bruce Dixon, where they had begun foreclosure proceedings, by surrounding their $27,000 hire car with hay bales in March 2015.”


Excessive credit drives personal insolvencies

26 September 2017

Macrobusiness reports that “new data from the Australian Financial Security Authority shows that in 2016–17, the most common non-business related causes of debtors entering personal insolvencies were: excessive use of credit (8,870 debtors), unemployment or loss of income (8,035 debtors) and domestic discord or relationship breakdown (3,222 debtors).”


Insolvency rates climb as fragile economy bites

26 September 2017

My Business reports that “the number of businesses falling into administration climbed by close to a third last quarter, highlighting fragility within the national economy. ASIC’s quarterly insolvency figures for the June 2017 quarter showed a 28 per cent spike in the number of businesses entering external administration – reaching 2,198, compared to 1,717 in the previous quarter.”


Funds were hidden prior to bankruptcy

21 September 2017

The Whitsunday Times reports “a prominent Proserpine woman concealed more than $58,000 after being served with a bankruptcy notice. Kim Moira Britton, 59, was served with the notice on March 12, 2014 following an unpaid family court judgment compelling her to pay $45,000. Britton made an application for funds to be withdrawn from her superannuation account on March 17 and later received two lump sum payments of $25,401.96 and $33,399.06.”


Insolvency laws make welcome leap into 21st century

20 September 2017

The Australian reports that “disruption, innovation and being Amazon-ready are often cited as the keys to business success and employment growth in a rapidly changing world. However, sometimes it is the practical changes to our legal framework that have the greatest potential to create lasting and meaningful change.”


Bouncing Back - How do you rebound from failure?

19 September 2017

SBS reports on “failure – we fret it, we shun it, and we question ourselves whenever it happens. But can failure be a blessing in disguise? In 1993, legendary Socceroos skipper Paul Wade became the first footy captain in 20 years to be axed from the national team for a bad attitude. Paul says he was humiliated – but admits it was the wakeup call he needed to improve his game. Facing up to failure isn’t always so simple. Jane Lu quit a coveted corporate job during the GFC to start her first business, but when it failed, she was too embarrassed to tell her parents – who she lived with.”


Businesses urged to seek advice on liquidators’ letters of demand

20 September 2017

The Townsville Bulletin reports “seek advice and don’t pay up, is the advice of Townsville professionals after several businesses have been hit with letters of demand for tens of thousands of dollars from liquidators. The letters of demand are part and parcel of the work of liquidators winding up the affairs of failed businesses and seeking returns for creditors, usually the banks. Townsville liquidator and principal of BRI Ferrier, Moira Carter, said there was an increasing trend for liquidators to issue “blanket” letters of demand.”


Do the New Safe Harbour Laws Quell Insolvency Fears?

19 September 2017

The Urban Developer reports that “safe-harbour reforms that deliver greater protection for directors of financially-stressed companies have passed through both houses of federal parliament. Currently awaiting royal assent, the Treasury Laws Amendment (2017 Enterprise Incentives No. 2) Bill 2017 amends the Corporations Act 2001 (Cth) and aims to protect directors acting to undertake a company restructure in response to insolvency — where it will receive a better result for stakeholders.”


R&I squad leaves NRF to set up new boutique

13 September 2017

Lawyers Weekly reports that “a team of Norton Rose Fulbright lawyers, including a restructuring and insolvency partner, has left the global giant to set up a boutique firm. Assured Legal Solutions announced today that it has opened for business in Sydney. The boutique firm focuses on commercial and financial services law. Nicola Cosgrove and Chris Cruikshank, of NRF’s restructuring and insolvency practice, co-founded the new firm. Ms Cosgrove has already left NRF, while Mr Cruikshank has resigned and will leave the global later in the year.”


Company 'phoenixing': New laws to target dodgy company directors

12 September 2017

ABC News reports that “tough new laws will be introduced in a bid to crack down on dodgy company directors and their advisers. Suspected phoenixers could also be forced to provide a security deposit, which would be used to recover tax debts. Directors of Australian companies will be given a unique identification number to help stop the illegal activity of "phoenixing" — where companies are stripped of assets and liquidated, then restarted under a different name leaving creditors out of pocket. Phoenixing is estimated to cost the Australian economy more than $3 billion a year.”


Insolvency reprieve on the cards for business leaders

11 September 2017

My Business reports that “tough insolvency rules could be relaxed, according to a federal minister, as the government looks to reduce the number of businesses pushed “prematurely” into insolvency. Speaking to a recent industry conference, financial services minister Kelly O’Dwyer said the onus should be on supporting businesses to survive and grow, not on penalising difficulties.”


AFSLs warned not to hire bankrupts

11 September 2017

Money Management reports that “Australian financial services licensees (AFSLs) should think twice before employing someone with a conviction or bankruptcy as they can threaten compliance with a licensee’s obligations, according to The Fold Legal. In a blog, head of licensing, Sonia Cruz wrote that employees with a history of bankruptcy or conviction could place the licensee at risk as they may not be of good fame and character, and they may be tempted to breach financial services laws or behave dishonestly.”


Bradman cap loaned by former Adelaide accountant Peter Mark Dunham ‘to be sold’ as he faces multimillion-dollar fraud case

8 September 2017

The Advertiser reports that “a rare Sir Donald Bradman “Baggy Green” cap is at the centre of a repossession bid to repay a multi-million dollar debt accrued by a criminally accused former Adelaide accountant. Peter Mark Dunham, 73, is accused of “abusing a position of trust” to steal, or deceive, victims and a national not-for-profit sports body, out of nearly $3 million over seven years. But as the former chartered accountant faces 37 theft and deception charges, dozens of creditors are fighting to recoup millions of dollars after he declared himself bankrupt in August last year.”


DibbsBarker woos another partner to continue Melbourne growth

7 September 2017

Australasian Lawyer reports that “DibbsBarker has wooed another partner to continue its growth in Melbourne. The firm has welcomed Joanne Hardwick as its fourth partner in Melbourne less than two weeks after it announced the appointment of banking and finance expert Jason Morris in the city. Hardwick came from Mills Oakley, where she was partner for the last eight years. Morris came from Allens, where he was partner for 10 years. Hardwick, who has more than 17 years’ experience in her specialty, is an expert in insolvency and restructuring.”


To who is the money owed?

6 September 2017

AJP reports that “Ramsay Health Care Australia has recently lost an appeal in the High Court in a case that judges say may be the first of its kind in the country. According to court documents, Ramsay had entered into an agreement with a company trading as Medichoice, which agreed to import medical products on Ramsay’s behalf. Medichoice was also appointed Ramsay’s distributor to coordinate the procurement, importation, logistics and inventory management of the products.”


Member for Indi Cathy McGowan calls on federal government to protect workers more with superannuation overhaul

4 September 2017

The Border Mail reports that “the federal government needs to make it simpler for workers to check their superannuation via pay slips, the member for Indi believes. Cathy McGowan is glad the government is tackling the problem of lost superannuation, but she believes more action is needed to protect employees from unethical bosses.”


No 'smoking gun' in fraud trial over collapsed Coast business

31 August 2017

The Sunshine Coast Daily reports that “a woman found the job of trying to pay Kleenmaid's creditors "so stressful she only lasted six weeks", a prosecutor has told jurors. Barrister Stephen Keim said Andrew Eric Young, accused of dishonestly getting a $13 million loan, was an "important" part of Kleenmaid businesses when the relevant firms were in dire straits. Mr Keim delivered the second day of the Crown's opening on Wednesday at the Maroochydore man's trial. Young, 64, is representing himself in Brisbane District Court.

He has pleaded not guilty to 19 fraud and insolvency trading charges.”


PRIMARY INDUSTRY

A2 Milk eyes Murray Goulburn

6 September 2017

The Australian reports that “listed dairy company a2 Milk is entering the contest to buy Murray Goulburn, according to sources, and it has drafted in investment bank Goldman Sachs as an adviser. The company, which sells milk with beta-casein proteins called A1 and A2, may enter a bid as part of a consortium given that it is not geared up to own Murray Goulburn in its entirety. A2 Milk has a market value of close to $3.8bn. Its shares have rallied as it increases its market share in Australia to its present 9.3 per cent.”


Daughter of bankrupt Wide Bay Burnett farmer allegedly has stud cattle taken by bank trustee

2 September 2017

Queensland Country Life reports that “the daughter of a Wide Bay Burnett cattleman, who was evicted and allegedly forced into bankruptcy, has had the stud Brahmans she bought from her parents seized by bank trustees. The 14 stud Brahman cows and calves are set to be sold, despite Brooke Dingle offering evidence of her full ownership. The females were originally purchased by Ms Dingle’s parents but were bought by Ms Dingle who was the registered owner with Australian Brahman Breeders Association since March 2014.”


ENTERTAINMENT

Western Force axed for Code’s Survival, ARU says

5 September 2017

The Daily Telegraph reports that “the ARU says it faced a potential $26 million black hole and insolvency within two years if they continued with five Super Rugby teams. The governing body released financial modelling compiled by their former chief financial officer Todd Day on their dire situation after the Western Force were officially cut from Super Rugby 2018 and beyond after losing an appeal in the Supreme Court of NSW. So startling is the ARU’s financial situation, they say they would have been forced to go into receivership by the end of 2019 had they persisted with five franchises.”


NOT FOR PROFIT

South Australian RSL appoints Corey Starkey as chief executive

23 September 2017

The Advertiser reports that “the South Australian RSL has taken another small step in its long road to recovery by appointing a chief executive. Corey Starkey has signed an 18-month contract to manage the state branch until well beyond the next board election in July. Mr Starkey, 41, has been appointed after — in an interim role — steering the branch through financial strife and damaging internal division.”


Failed charity directors including former Wallaby Glen Ella face court

10 September 2017

The Sydney Morning Herald reports that “the NSW government has signalled its support for courtroom examinations of directors of the failed Guardian Youth Care charity, including former Wallaby Glen Ella, amid claims $20 million was misappropriated. Guardian Youth Care collapsed in June after receiving more than $6 million in taxpayer funds each year to care for children with high needs and dangerous behaviour in group homes across Western Sydney.”


AUSTRALASIA

COMMUNICATIONS

Ericsson files insolvency case against India's Reliance Comms

14 September 2017

Yahoo 7 News reports that “Ericsson's Indian subsidiary has filed insolvency petitions against Reliance Communications and two of its companies to recover unpaid dues, the Indian mobile operator said in a stock exchange filing on Wednesday. The Swedish telecoms equipment maker, which signed a seven-year deal in 2014 to operate and manage Reliance Communications' nationwide network, is seeking a total of 11.55 billion rupees ($180 million) from the three companies, the filing said. Reliance Communications said it planned to challenge the insolvency petitions. The filing said the Ericsson case would go before the National Company Law Tribunal, the designated court for bankruptcy cases in India, on Sept. 26.”


RETAIL

Topshop New Zealand collapses into receivership

7 September 2017

Smart Company reports that “the New Zealand operating arm of international fashion brand Topshop has fallen into receivership, reports The NZ Herald, despite reportedly making an assurance earlier this year the business would remain in operation after the Australian arm’s collapse. Directors of Top Retail Ltd, which operates the British fashion brand in New Zealand, say the business will continue to trade until a decision can be made about its future.”


EUROPE

TOURISM

Russian airline VIM-AVIA heads for receivership

27 September 2017

Yahoo 7 News reports that “tens of thousands of passengers were stranded Tuesday as Russian airline VIM-AVIA said it could no longer operate without state help but the government said it was not planning to prop up the carrier. VIM-AVIA, Russia's 10th largest carrier, said it was planning to go into receivership due to financial hardship and called for state support as tour operators urged the authorities to help avert an industry-wide crisis.”


UNITED STATES

RETAIL

Toys 'R' Us mulls bankruptcy filing: Wall Street Journal

16 September 2017

Yahoo 7 News reports that “Toys ‘R’ Us Inc could file for bankruptcy in the coming weeks as pressure from skittish suppliers intensifies, the Wall Street Journal reported on Friday, citing people familiar with the matter. The company and its restructuring advisers are considering filing for Chapter 11 protection in the U.S. Bankruptcy Court in Richmond, Virginia, according to the WSJ report. (http://on.wsj.com/2h87WOt)

The privately-held toy retailer had previously said it was working with investment bank Lazard Ltd to help address its approximately $5 billion in debt, of which roughly $400 million comes due next year.”


LEGAL

Puerto Rico oversight board 'appreciates' offer of creditor support

27 September 2017

Yahoo 7 News reports that “Puerto Rico's federally appointed financial oversight board said on Wednesday that it "appreciated the expression of support from creditors" of the island's bankrupt power utility, after those creditors earlier offered a $1 billion loan and a discount on a portion of existing debt.”


Hartford's rating sinks deeper into junk; agencies cite possible default

27 September 2017

Yahoo 7 News reports that “Hartford, Connecticut's cash-strapped capital city, suffered a fresh round of credit rating downgrades deeper into junk territory by two Wall Street credit agencies on Tuesday, a day after the city's bond insurers said they were open to debt restructuring. The downgrades by S&P Global Ratings and Moody's Investors Service put Hartford almost at the bottom of the credit scale and mean that the agencies view the city as essentially in default with little prospect for a full bondholder recovery.”


JPMorgan scores partial win in $1.5 billion GM bankruptcy dispute

27 September 2017

Yahoo 7 News reports that “JP Morgan Chase & Co <JPM.N> scored a partial victory on Tuesday in a long-running dispute over the repayment of a $1.5 billion loan it made to General Motors' bankrupt predecessor, known as 'Old GM'. U.S. Bankruptcy Judge Martin Glenn in Manhattan sided with the bank against Old GM's unsecured creditors, who have been trying to claw back the money, finding that most assets securing the loan, like robots and conveyor belts, were "fixtures" covered by a JPMorgan lien.”


U.S. agency claims huge hole in Westinghouse's pension plan

23 September 2017

Yahoo 7 News reports that “employees of U.S. nuclear power firm Westinghouse Electric Co LLC, which is bankrupt and reeling from a failed reactor project, got a nasty surprise recently: in the eyes of the U.S. government's pension insurer, its retirement plan has a massive shortfall. While bankrupt companies often have big pension deficits, the vast majority flag the underfunding years in advance of filing for Chapter 11. By contrast, the Westinghouse Electric Co Pension Plan, which has about 9,700 participants, appeared fully funded in its most recent report to the Department of Labor in 2015.”


Puerto Rico judge advises legal issues be put on hold after Maria -source

22 September 2017

Yahoo 7 News reports that “the devastating blows dealt to Puerto Rico by Hurricanes Irma and Maria are putting the woebegone U.S. territory’s bankruptcy on the backburner, sources said on Thursday. According to a person familiar with the bankruptcy proceedings, the team of judges overseeing the case has directed parties to put legal issues on hold indefinitely, as the territory recovers from an unprecedented one-two punch of natural disasters.”


Nine years on, another Lehman Brothers bankruptcy

2 September 2017

Yahoo 7 News reports that “two affiliates of Lehman Brothers, the U.S. investment bank that collapsed in 2008 and fueled an economic crisis, filed for Chapter 11 bankruptcy late on Thursday, a reminder of the complexity of unwinding a global financial institution. The two affiliates, Lehman Brothers U.K. Holdings (Delaware) Inc and Lehman Pass-Through Securities Inc, were put into bankruptcy as part of a deal that will generate $485 million cash for the Lehman estate, according to court documents.”


SOUTH AMERICA

COMMUNICATIONS

Oi's Brazil license rift to slow debt talks

2 September 2017

Yahoo 7 News reports that “a move by Brazil's telecommunications industry watchdog to analyze whether to remove Oi SA's operating license will further complicate Latin America's largest-ever bankruptcy protection case, now in its 15th month, a person with knowledge of the matter said. The person, who asked for anonymity to discuss the issue freely, said Thursday's announcement by regulator Anatel was "surprising," given that a vote on Oi's in-court reorganization plan was scheduled for Oct. 9. Talks between shareholders and creditors are "going well," the person added.”

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