August 2018 News Digest – Business Insolvency and Turnaround

03 September 2018

The following are summaries of media stories related to business turnaround and insolvency in Australia during August 2018.


Property and Construction

Whyalla’s Ottoway Engineering and associated company Ottoway Fabrication had debts of $45m

31 August 2018

The Advertiser reports that “in the case of Ottoway Fabrication the administrators say: “our preliminary investigations suggest the company may have been insolvent from…”

Construction firm enters liquidation

30 August 2018

The West Australian reports that “prominent Albany construction business Tectonic Construction Group entered liquidation last week with immediate effect.”

Subcontractors on $87 billion worth of NSW infrastructure lack safeguards, commissioner says

29 August 2018

ABC News reports that “infrastructure projects worth $87 billion being rolled out across New South Wales over the next four years are being carried out with no safeguards to protect subcontractors' businesses, a Government commissioner has revealed.”

Company fined $7K after $220K client theft

29 August 2018

My Business reports that “a real estate agency that stole $220,000 in client funds before collapsing has been fined just $7,500 after being convicted on 12 charges, but the prosecuting agency insists the matter is far from resolved.”

Queensland builder The Cleary Group collapses owing $3m

28 August 2018

The Courier Mail reports that “since the company has gone into liquidation, we’ve started the legal…”

Hickory puts unit into administration days ahead of $13m VCAT cladding claim

27 August 2018

The Australian Financial Review reports that “builder Hickory Group has put subsidiary H Buildings into voluntary administration just days before the subsidiary was due to face a $13 million tribunal claim to replace the combustible cladding on four residential buildings.”

Bankrupt 'Gordon Gekko' scores development on government land

27 August 2018                         

The Age reports that “a failed Melbourne businessman who styles himself on Wall Street character Gordon Gekko has become a partner with a state government agency in a luxury ski resort project, even though he owes more than $61 million in bad debts.”

Home builders at high risk of bankruptcy under new staged payment scheme

16 August 2018 reports that “just when the conduct of the banks is under an intense microscope, they have recently made some problematic changes to their lending practices that are giving those planning on building or renovating their home some big headaches.”

'Complete scumbags': Would-be home-buyers ‘lose $3m in deposits'

15 August 2018

Nine News reports that “about 100 would-be homeowners have had their dreams crushed after an estimated total of $3 million in housing deposits went missing. Winning Post Officer, the company offering the parcels of land, allegedly took the deposits before the families were told the company had gone into liquidation.”

Subbies ‘will be paid’ for stadium footbridge work

8 August 2018

The West Australian reports that “the financial woes of a company working on the new stadium footbridge have prompted the State Government to guarantee that subcontractors will not be out of pocket. York Civil, which was part of a joint venture to build the Matagarup Bridge, went into administration yesterday, leaving one contractor owed about $500,000.”

New head contractor for Princes Highway upgrade at Dignams Creek

14 August 2018

Bega District News reports that “Fulton Hogan has been selected to take up the head contract to complete the delivery of the Princes Hwy upgrade at Dignams Creek.”

Cooper & Oxley pledge to win back subbies’ trust

1 August 2018

The West Australian reports that “Cooper & Oxley’s newly appointed chief executive Bob Hudson has promised the builder is entering a new era of transparency and will earn back the confidence of subcontractors working on its projects. Mr Hudson, speaking to The West Australian less than two months into his new job, admitted there were “continuing issues” emerging about how Cooper & Oxley projects were running.”


Noni B boosts profit five-fold after Packer purchase

29 August 2018

Nine News reports that “after coming close to collapse in 2014, women's wear retailer Noni B has produced a fivefold surge in full-year profit and is on track to boost future revenue to $1 billion a year.”

Foodora faces claims for unpaid tax and superannuation

28 August 2018

The Sydney Morning Herald reports that “Australian tax authorities are chasing Foodora for unpaid tax and superannuation having classified the company's food delivery riders as employees instead of independent contractors. The Australian Taxation Office and Revenue NSW began investigating Foodora's tax obligations before the food delivery company went into voluntary administration earlier this month.”

Why Will Vicars rescued struggling fashion brand Oroton

28 August 2018

The Australian Financial Review reports that “if fashion is about flash then Will Vicars might have looked an outside bet. The chief investment officer and part owner of Caledonia Investments manages billions on behalf of some of the country’s richest and most private families, and Vicars tends to be just as private.”

Online footwear retailer Shoes of Prey halts production

28 August 2018

Nine News reports that “online footwear retailer and start-up darling Shoes of Prey has halted production as tough market conditions force its owner to shut up shop.”

Shaver Shop hurt by fraud, supplier liquidations

24 August 2018

Appliance Retailer reports that “a former Shaver Shop store manager committed unauthorised sales, totalling $327,000, and two suppliers filed for liquidation during the year ended 30 June, 2018. This resulted in a 27% drop in net profit to $6.6 million for the reported period.”

Darrell Lea looks to new categories

15 August 2018

Food & Drink Business reports that “the confectionery company has staged a strong comeback six years after being bought out of voluntary administration by Queensland entrepreneurs, Tony and Christina Quinn, who in January sold the majority of the business to Quadrant Private Equity.”

Oroton, Cue and David Lawrence pop the champagne on major milestones

8 August 2018

The Australian reports that “this time last year it was unclear whether Oroton would make it to its own 80th birthday party. The brand and its parent company, Oroton Group, staggered towards the end of the year in voluntary administration as its share price hit an 18-year low, among other crises.”

Steinhoff's Australian nightmare before Christmas

2 August 2018

The Australian Financial Review reports that “Michael Ford, the chief executive of Steinhoff Asia Pacific, spent seven years on active military service, so he knows what he's talking about when he describes joining the company as "walking into an ambush". Ford, the former chief executive of The Good Guys, which is now owned by JB Hi-Fi, joined Steinhoff in October last year.”

Katanning co-op goes into voluntary administration

1 August 2018

The West Australian reports that “Katanning BKW Co-Operative shop has gone into voluntary administration.

In a letter to members BKW Co-op chairman Norm Flugge said the board was calling for expressions of interest in the business, which has operated for 96 years.”

Another designer name in liquidation

1 August 2018

Ragtrader reports that “luxury shopping destination The Designer Forum has shut up shop.

The apparel and accessories chain stocked a number of high-end Australian brands, including Camilla & Marc, Bassike, Lover, Dion Lee and Zimmermann.”

Tourism and Hospitality

“I had two hours”: When Jamie Oliver discovered his restaurant empire was falling apart

31 August 2018

Smart Company reports that “celebrity chef Jamie Oliver says he had just hours to take action to save his restaurant business from collapsing entirely, and he still doesn’t understand what went wrong. In an in-depth interview with the Financial Times, Oliver opened up about the phone call that changed everything last year.”

Cafe Brass debacle could bankrupt general manager

19 August 2018

The Australian Financial Review reports that “we've previously covered the messy demise of Cafe Brass, the swanky restaurant in Melbourne's inner-city that failed after only a few months, after its wealthy backers – including billionaire investor Alex Waislitz, real estate classifieds wizard Antony Catalano, high street jeweller Marcus Rose and KPMG wheeler-and-dealer Jon Adgemis – pulled the pin on the venture, which had yet to make a profit.”

Foodora enters voluntary administration

17 August 2018

The Australian Financial Review reports that “Foodora has gone into voluntary administration over concerns it cannot exit Australia solvent, suspending a potentially precedent-setting sham contracting case against the gig company.”

A bankrupt Applebee's franchisee claimed in a lawsuit that IHOP's 'ballyhooed rebranding' as IHOb put its burger sales at risk

16 August 2018

The Business Insider reports that “IHOP’s short-lived name change to IHOb is getting pulled into a battle between one of Applebee’s biggest franchisees and the chain’s parent company. In May, Applebee’s second-largest franchisee, RMH Holdings, filed for bankruptcy.”

Adriano Zumbo, Jamie Oliver and why celebrity chefs have so much trouble in Australia

6 August 2018

SmartCompany reports that “you’d be hard pressed to find anyone with a bad word to say about Jamie Oliver. The British TV darling who brought market-fresh meals to the tables of everymen everywhere, retains a personal brand as warm and inviting as his flaming rum’n’raisin. And yet, it seems no amount of fuzzy public sentiment could stop the collapse of his Australian chain of restaurants, Jamie’s Italian. Only four Australian franchises remain after an 11th-hour takeover, while Oliver’s global operations continue to struggle to refinance up to $125 million in debt.”

The Brisbane Hotel: former owners Capital Management under voluntary administration

1 August 2018 reports that “the company formerly behind The Brisbane Hotel has been placed under voluntary administration, leaving in its wake debts worth hundreds of thousands of dollars. Prominent hospitality operator Geoff Hayward cited high rents and a soft economy for entertainment venues on the Brisbane’s trading losses for Capital Management over the past two years.”

Hooters ‘up for sale’ as Aussie owner backs away

1 August 2018 reports that “Hooters Australia has once again been placed in voluntary administration, less than two years after its new owner vowed to breathe fresh life into the controversial “breastaurant” chain. It’s the latest blow for the American sports bar, infamous for its scantily clad waitresses dubbed “Hooters girls”, which has struggled to gain acceptance in the Australian market since opening its first location more than a decade ago.”


Henessy Transport sold prior to liquidation to biz now linked to son

24 August 2018

ATN reports that “Victorian Police have located some of the vehicles missing from Hennessy Transport after their registrations were allegedly wrongly transferred to a third party earlier this year.”

“More trouble than the early settlers”: Tram plan delayed as problems continue

7 August 2018

IN Daily reports that “Premier Steven Marshall has conceded an election pledge to build a right-hand turn for trams onto North Terrace will not meet its stated 12-month deadline, while his Transport Minister says he won’t know how – or even if – the project will proceed until a departmental review is completed in October.”


Big fall from grace as Big Un calls in administrators

29 August 2018

The Australian reports that “online video outfit Big Un’s move to appoint voluntary administrators caps a stunning fall from grace for a company that was once touted as tech’s next big thing.”

The forgotten Microsoft deal that saved Apple from bankruptcy

5 August 2018 reports that “Apple has made history by becoming the first private-sector company to surpass $US1 trillion in market value. That is, the total number of Apple shares on the market times their price amounts to more than a trillion US dollars.”


Four major fin services firms a “high to severe” insolvency risk

22 August 2018

Money Management reports that “some of Australia’s largest financial services firms are on the brink of insolvency following the seemingly continuous revelations of misconduct uncovered by the Royal Commission this year.”

Some Tesla suppliers fret about getting paid

21 August 2018

The Australian reports that “Tesla’s tumultuous year has fuelled concern among some of its suppliers about the automaker’s financial strength after production of the Model 3 car drained some of its cash, according to industry executives and documents.”

Former Lehman Brothers bankers planning secret party decade after collapse

21 August 2018

Nine News reports that “former employees of Lehman Brothers are reportedly planning a secret party to mark 10 years since the investment firm’s colossal collapse.”

Fortunes reversed for former mates as billionaire Gerry Harvey helps Nathan Tinkler emerge from bankruptcy as Troy Palmer goes under with debts of $21 million

18 August 2018

The Newcastle Herald reports that “in a sliding doors moment, Nathan Tinkler’s former right-hand man, Troy Palmer, has been declared bankrupt with debts of more than $21 million, just as word emerges that his former one-time billionaire boss has had his personal bankruptcy annulled.”

In this never-ending Lehman short, $US170,000 is still on the table

14 August 2018

The Australian Financial Review reports that “it's been a decade since former New York hedge fund manager Whitney Tilson made millions by betting against Lehman Brothers before it collapsed. But he's still frustrated by the profit he can't get his hands on.”

Eclipx clipped on slashed guidance

8 August 2018

The Australian reports that “sales financing group Eclipx flopped in the market yesterday after it halved guidance for its full-year profit growth, down to between 13 per cent and 17 per cent, from as much as 30 per cent.”

Small business

Thousands of Australian businesses on the brink of collapse as weak property markets make SME owners “skittish”

24 August 2018

SmartCompany reports that “new data from one of Australia’s biggest insolvency firms has revealed there are nearly 10,000 small to medium businesses on the brink of collapse, and experts says business strength is unlikely to improve.”

Goode Continuous enters liquidation

16 August 2018

ProPrint reports that “Gold Coast based Goode Continuous Printing is in liquidation after operating for 31 years, with McDonald Printing Group buying its client list. Goode Continuous, based in Moledinar, was a trade printer specialising in continuous business forms, receipts, carbonless invoices, NCR docket books and pads.”

Champion Travel owed almost $1.6 million when it collapsed, and only had $57 in bank

3 August 2018

The Advertiser reports that “the travel agency run by former chairman of the Adelaide 36ers Malcolm Simpson had just $57 in the bank when it collapsed with debts of almost.”


Bankrupt convicted for disposal of funds bequeathed from deceased estate

29 August 2018

Mirage News reports that “on 14 August 2018, Mr Peter Roy Wakeling pleaded guilty in the Toowoomba Magistrates Court to six counts of disposing of property worth more than $20. On 15 December 2015, while he was an undischarged bankrupt, Mr Wakeling received $172,400 in his bank account, bequeathed from a deceased estate.”

ATO phoenix sting targets directors, advisers

29 August 2018

My Business reports that “the Federal Court has commenced public examinations on dozens of entities connected to a dodgy pre-insolvency adviser, amid concerns they had implemented advice to engage in phoenix activities to avoid creditors.”

Stacey avoids bankruptcy as more tip over the edge

4 August 2018

The Sydney Morning Herald reports that “Stacey Barrass was within months of personal bankruptcy after a relationship break-up left her with about $100,000 in debts. The single mother of three boys, the oldest aged 16, says she had, and still has, a large mortgage and had to take drastic measures in order not to lose her home. Barrass, 47, received some budgeting advice and tips on how to negotiate with her bank from a neighbour, who is a friend and also a financial adviser.”

Former director guilty of stealing company property

3 August 2018

My Business reports that “removing property that belongs to a company in liquidation is against the law and attracts serious penalties, as the former director of a Queensland business has discovered the hard way. Adam John Copping of the Brisbane suburb of Ascot was found guilty in court of fraudulently removing company property after the Australian Securities and Investments Commission (ASIC) launched action.”

ASIC approves new banking code

1 August 2018

Mortgage Business reports that “the Australian Securities and Investments Commission (ASIC) has approved the Australian Banking Association’s new Code of Banking Practice (COBP), set to commence operation on 1 July 2019. The new code has been approved following a prolonged dispute over certain terms of the new code, which came to light during the third round of hearings of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.”

Not for profit

Embattled charity FSG Australia enters liquidation owing $25 million

6 August 2018

The Gold Coast Bulletin reports that “disgraced Gold Coast disability service provider FSG (Freedom, Social Justice, Growth) Australia has been put into liquidation, owing more ...”


Solar Analytics buys Matter ahead of equity raising, expansion plans

21 August 2018

One Step of the Grid reports that “New South Wales-based energy technology company Solar Analytics has bought up the remains of failed PV-sharing startup, Matter. The acquisition comes as Solar Analytics prepares to launch into a second stage of expansion and product development, backed by a new round of fund raising.”

Primary industry

Farming dynasties stalk retailer’s soured dairy dream

9 August 2018

The Australian reports that “companies controlled by two of Australia’s largest pastoral families, the Periches and the Moxeys, are said to be among the parties circling Harvey Norman’s failed dairy farm operation.”


Australian taxpayers should not have to pay for Albatross work twice – Defence

7 August 2018

South Coast Register reports that “the Department of Defence will not be following the NSW Government’s lead and bailing out local subcontractors left out of pocket from a major defence contract a HMAS Albatross.”


West Perth creditors told to see cents after voluntary administration analysis

30 August 2018

Joondalup Times reports that “West Perth creditors can get back 4 per cent of what they are owed or get nothing.”

Seven West Media and Netflix ink co-production deal for Zumbo's Just Desserts

27 August 2018

The Australian Financial Review reports that “Seven West Media has teamed up with US streaming giant Netflix to bring back Adriano Zumbo's Just Desserts as the free-to-air program.”

Alison Wonderland Touring Company In Liquidation, After Owing $776,000

20 August 2018

Music Feeds reports that “a touring company of which producer Alison Wonderland (real name Alexandra Sholler) is a major stakeholder is in the process of being liquidated, after owing over $776,000 to suppliers following Wonderland’s 2017 ‘Scarehouse Project’ tour.”

Newcastle golf club goes into administration despite Aveo retirement village lifeline

14 August 2018

The Weekly Source reports that “the Shortland Waters Golf Club is now likely to be taken over by another club after falling membership and disruption from building work drained its cash reserves.”

New Western Force campaign backs fans to take ownership

4 August 2018

The West Australian reports that “the reborn Western Force are set to become Australia’s premier fan-owned club under a resurrected Own the Force campaign. Talks between World Series Rugby and a group of influential powerbrokers in the WA rugby community, including a number who financially backed the original 2004 Super Rugby bid, have been held to discuss the club’s ownership.”

CaseLabs Bankrupt!

11 August 2018

Gamers Classified reports that “CaseLabs recently released a statement that detailed their announcement and some of the reasons why they are facing bankruptcy and liquidation. The major reason why would be pointed to tariffs that hiked their prices by up to 80%. This coupled with their accounts that they owe to other companies, it culminated into a huge amount of debt that was simply not payable.”

Perth Fringe Festival performers among creditors owed $672,000 after JumpClimb collapse

10 August 2018

ABC News reports that “artists and performers left tens of thousands of dollars out of pocket after the collapse of a Perth-based management firm have been told it is unlikely they will see any of the money owed.”

Melbourne International Film Festival: independent Australian filmmakers bankrupt but proud

4 August 2018

ABC News reports that “in 2017, the average budget of an Australian film was estimated at $8.7 million. So when Ted Wilson says he made his debut feature for $80,000, it sounds like chump change — except that Wilson financed the film from his own pocket.”



Malaysia cancels Belt and Road projects with China over bankruptcy fears

21 August 2018

The Sydney Morning Herald reports that “Malaysian prime minister Mahathir Mohamad has told China's leaders he was cancelling a controversial rail project in order to reduce Malaysia's debts. Malaysian newspaper The New Straits Times reported that Dr Mahathir said the East Coast Rail Link and a gas pipeline project would be cancelled.”