November 2018 Business Restructuring, Turnaround and Insolvency News Digest
03 December 2018
The following are summaries of media stories related to business turnaround and insolvency in Australia during November 2018.
The following are summaries of media stories related to business restructuring, turnaround and insolvency in Australia during November 2018.
Australia
Property And Construction
Prefab pioneer Strongbuild goes into administration after major contract cancellation
14 November 2018
The Australian Financial Review reports that “prefabricated construction pioneer Strongbuild went into voluntary administration after major developer cancelled a $45 million contract leaving the builder unable to pay its bills.”
Business that could fail in a property crash
25 November 2018
The Cairns Post reports that “house prices are causing a lot of people sleepless nights. The pace of price falls just won’t stop accelerating. Where will the impact hit? Some commentators keep looking nervously at the banks, which have huge property exposures.”
Adelaide Magistrates Court sets trial date in fraud case against former bankrupt developer
20 November 2018
The Advertiser reports that “a trial date has been set in a fraud case against former bankrupt property developer Salvatore “Sam” Sgherza.”
Bankrupt Phil Sullivan linked to $15.5m mortgage to Broadbeach Mark Howard development
17 November 2018
Gold Coast Bulletin reports that “a company directed by twice bankrupt retiree Phil Sullivan, who was ordered to pay more than $70 million to creditors of his failed investment firm.”
Retirement village developer Aveo buys struggling Shortland Waters Golf Club for $1.25m
9 November 2018
The Newcastle Herald reports that “Shortland Waters Golf Club members say they feel “dudded” after retirement village developer Aveo bought the 50-hectare course for just $1.25 million. Club president Ron Freeman said Shortland Waters had no option but to sell to Aveo after going into voluntary administration this year.”
Liquidator appointed to building business with offices across Queensland
8 November 2018
Courier Mail reports that “the Australian Securities and Investments Commission website states Irwin Homes Pty Ltd went into liquidation as of October 31.”
8 November 2018
The Advertiser reports that “Small creditors will likely suffer the greatest losses after the collapse of York Civil, as administrators reveal the damage bill from after the firm’s collapse.”
Mining
Eastern Goldfields signals voluntary administration
29 November 2018
Australian Mining reports that “Eastern Goldfields has announced that it may go into voluntary administration following the collapse of a $75 million recapitalisation.”
Retail
‘I won’t deal with shopping centres again’: New future for Nuts About Tella after landlord dispute
29 November 2018
Smart Company reports that “Melbourne business owner Mark Elkhouri has expansion on his mind and has just returned from a trip to Sydney, checking out possible locations for his dessert restaurant Nuts About Tella.”
Max Brenner Has Been Sold, For Real This Time
29 November 2018
Broadsheet reports that “it went broke, then was saved, then the buyer pulled out leaving its future uncertain. Now, melted-chocolate franchise Max Brenner has been bought by Roy Mustaca, an opera singer and chairman of the independent cinema chain United Cinemas.”
Bettina Liano is returning to Aus
28 November 2018
Fashion Journal reports that “an icon returns. Remember Bettina Liano? The iconic denim label went into voluntary administration back in 2011, announcing a focus on the US market instead. Fast forward to 2018 and the brand – now owned by Apparel Group – is making its return to Australian shores.”
Aussie Retailers Are 'Going Bust' In Record Numbers
27 November 2018
Lifehacker reports that “data from business analytics company illion shows a record number of Australian retailers are going to the wall. Although relatively low as a percentage of all companies, the negative trend is worth highlighting given the laundry list of headwinds already facing the sector.”
Victoria’s largest independent butcher Tasman Butchers has been saved from administration
16 November 2018
SmartCompany reports that “Victoria’s largest independent butcher, Tasman Butchers, has been saved from administration by two of its buyers, Mario D’Ambrosio and Frank Porcino. The big-box meat retailer has been for sale since September after being placed into voluntary administration.”
Clothing retailer closes its doors
16 November 2018
Bay 93.9 reports that “Roger David stores are set to close their doors next month after failing to find a buyer to keep the retailer afloat. The chain, which has been operating for 76 years and has stores around the country including in Geelong, went into voluntary administration last month and was given four weeks to find a buyer.”
16 November 2018
Business Insider reports that “Amazon CEO Jeff Bezos made a stunning acknowledgment last week in an all-hands meeting, a recording of which was heard by CNBC. With the company valued at just shy of $US1 trillion and Bezos being the richest man in modern history, the Amazon CEO said his 24-year-old firm was far from invincible.”
Tourism and Hospitality
Learning from Foodora: How should gig-economy workers be defined?
29 November 2018
SmartCompany reports that “had Foodora’s Australian operations not already gone into voluntary administration, the Fair Work Commission’s November 16 decision might well have finished the food-delivery company off.”
Paesano Cucina in North Adelaide closes after more than 30 years, owing $330000 in rent
28 November 2018
The Advertiser reports that “over more than 30 years, North Adelaide cafe Paesano has survived a change of location, multiple owners, a fire and an infamous bike shooting.”
Technology
30 November 2018
Business Insider reports that “while high-profile bankruptcies like Sears and Toys R Us may grab the headlines, thousands of business entities across the United States quietly declare bankruptcy every month and the number is on the upswing. The most recent statistics from the American Bankruptcy Institute show that commercial Chapter 11 filings increased 75 per cent in October 2018 on a year-over-year basis.”
Bosses of failed venture Bux claim unpaid super and wages
18 November 2018
The West Australian reports that “the bosses of the failed Bux money transfer app — which was declared bust this year with almost $100 million of investors’ money missing — are claiming they are owed unpaid wages and outstanding superannuation from the failed venture.”
Consumer groups highlight Afterpay risks as ASIC prepares report
16 November 2018
The Sydney Morning Herald reports that “the corporate regulator has declined to say whether 'buy now, pay later' companies like AfterPay should face increased regulation, despite strong concerns from consumer groups ahead of the report into the sector early next month.”
14 November 2018
Audroid reports that “Wesfarmers has announced that it has acquired some of the technology behind Unlockd, the app which launched last year giving customers in the Wesfarmers owned FlyBuys rewards program the chance to earn points by looking at ads on their lockscreen.”
Investment
Assetinsure sold by CBL administrator
8 November 2018
Insurancenews.com.au reports that “CBL Corporation’s voluntary administrators announced today a deal to sell Sydney-based Assetinsure to Lombard Australia, a newly formed holding company made up of an alliance of surety providers.”
Small Business
Gopher Graphics enters liquidation
26 November 2018
ProPrint reports that “Sydney graphic design outfit Gopher Graphics has gone into liquidation with all staff except two given new employment contracts, a former employee says.”
Bankrupt former Lara recycling centre boss David McAuliffe still living life of luxury
15 November 2018
Geelong Advertiser reports that “bankrupt C&D Recycling operator David McAuliffe has admitted to buying $550 boots despite telling court on Wednesday that he couldn't afford a lawyer.”
Insolvency rates hold steady as smaller firms continue to account for most failures
14 November 2018
The Australian reports that “insolvency rates among small-to-medium sized businesses have largely held steady in the last financial year, according new ASIC data. Overall, the number of insolvencies fell from 8425 to 8202 for the year through June.”
“A huge issue”: Ombudsman to examine the effect of late payments on small business cashflow
12 November 2018
SmartCompany reports that “businesses and government departments paying invoices late will come under the microscope in a review into the effect late payments have on small business cashflow, to be conducted by Australian small business and family enterprise ombudsman (ASBFEO) Kate Carnell.”
Anger and tears as Cessnock laundry wraps up
9 November 2018
Cessnock Advertiser reports that “it was a bittersweet scene at Endeavour’s (EGA) laundry at South Cessnock on Thursday as staff left the site for the final time. Current and former supported staff and supervisors held a small rally outside the linen service to say goodbye to friends while also venting their frustration and anger over the closure of the business that had been a staple in Cessnock for nearly 50 years.”
Legal
Bankruptcy exclusion period: will dropping it to one year really improve economic growth?
30 November 2018
In the Black reports that “Australia's bankruptcy exclusion period is being reduced from three years to one year. Will this really reduce barriers and improve economic growth?”
ATO steps in to protect honest workers and suppliers
30 November 2018
Mirage News reports that “the Australian Taxation Office (ATO) has successfully applied to the Federal Court for the appointment of a provisional liquidator for eight labour hire businesses providing services to the meat processing and abattoir industry.”
Former bankrupt manager convicted over false AFSL docs
23 November 2018
IFA reports that “a Gold Coast court has convicted a former manager after he made false claims in an AFSL application over a previous bankruptcy.”
CBL: high-flying insurer to be liquidated
13 November 2018
Insurancenews.com.au reports that “CBL Insurance will be wound up after the High Court in Auckland approved an application by the Reserve Bank of New Zealand to liquidate the business. The business has been in court-imposed interim liquidation and its parent company CBL Corporation in voluntary administration since February.”
Alleged phoenix scam operator Philip Whiteman ‘has many aliases’
7 November 2018
The Australian reports that “which of his names alleged phoenix scam operator Philip Whiteman uses depends on which of his phones he answers, a disgraced former liquidator who works with the Melbourne accountant has told a court.”
Education
Perth training centre goes bust, but tells students it's closing for 'renovations'
9 November 2018
The Sydney Morning Herald reports that “Perth CBD training provider the Australian Institute of Commerce and Technology (AICT) has gone into liquidation following the national regulator’s decision not to renew its registration.”
Energy
South Australian hydrogen plan sinks
29 November 2018
InDaily reports that “plans to produce hydrogen in the Cooper Basin for up to 50 years, strongly encouraged by the State Government, have stumbled badly for lack of finance.”
RCR Tomlinson collapse: who lost, and who got away
26 November 2018
The Australian Financial Review reports that “we surely haven't heard the last of the shock RCR Tomlinson administration, which came only three months after the company raised $100 million from investors while assuring them cost blowouts on two Queensland solar farms were "project specific". Turns out things were so dire that the refusal of RCR's lending syndicate to lend it more money meant it had to seek a voluntary administration.”
Not For Profit
VacSwim under threat as SA's Royal Life Saving Society placed into voluntary administration
24 November 2018
The Advertiser reports that “the Royal Life Saving Society's South Australian chapter has sunk – placed into voluntary administration after claims of a failed recycling venture.”
Entertainment
Ten Kate Superbike team declared bankrupt after Honda split
28 November 2018
Yahoo 7 News reports that “the Dutch squad has run Honda's effort in WSBK and in World Supersport for the last 18 years, winning 10 titles across both classes, including James Toseland's 2007 triumph – Honda's last in WSBK to date.”
Sporties Dubbo enters voluntary administration
20 November 2018
New Liberal reports that “the Dubbo Railway Bowling Club Ltd, trading as Sporties Dubbo, has entered into voluntary administration. The club entered administration on November 15.”
Telltale Games is now gone for good, with the company in liquidation
18 November 2018
Ausdroid reports that “after our last story on Telltale Games in September, things have progressed and the game company is now gone for good. News broke in the US this week confirming that Telltale Games has entered into liquidation and will basically cease to exist come end of November.”
Tigers Five Dock closed by administrators, with venue ‘not viable’ enough to continue
10 November 2018
Daily Telegraph reports that “the fallout from Balmain Leagues Club entering voluntary administration has hit Five Dock with the popular Tigers venue on Barnstaple Rd forced into closure.”
Camden nightspot enters voluntary administration
10 November 2018
Daily Telegraph reports that “popular Camden nightspot Barenz has entered voluntary administration. The owner declined to comment about the business being in administration.”
RSL SA/NT branch's sale of Alice Springs building to pump $500000 toward clearing creditor's debts
10 November 2018
Daily Telegraph reports that “the once endangered RSL SA branch is about to repay in full the $1.4 million owed to its creditors and retain its charitable status, in a major milestone”
Mosman Rowers set to reopen by end of year
8 November 2018
Daily Telegraph reports that “Mosman Rowers has been saved by the community. The club was on the brink of closing its doors but a campaign successfully raised enough funds to keep it afloat.”
Communications
Big Un a step closer to liquidation as Deloitte extends investigation
23 November 2018
The Australian Financial Review reports that “Big Un, the small business video company at the centre of a major accounting scandal, faces potential liquidation after its administrators requested more time to investigate the collapsed business.”
Telstra, Vocus failing to deliver NBN's cheaper internet plans to retailers
21 November 2018
The Australian Financial Review reports that “two of the biggest wholesalers of the national broadband network are not delivering NBN Co's new cheaper bundles in full to retailers, a failure that has contributed to the collapse of at least one NBN reseller and predictions that more will follow.”
Primary Industry
Struggling WA pig farmers urge consumers to buy local pork this Christmas
18 November 2018
The West Australian reports that “WA’s struggling pig farmers have urged consumers to shop for more locally grown pork this Christmas to help save their industry, which is on the brink of collapse.”
Gerry Harvey's inexplicably poor returns on Coomboona
5 November 2018
The Australian Financial Review reports that “at least Coomboona Dairies isn't costing Harvey Norman shareholders any more cash. Last week its administrators informed Harvey Norman, the first-ranking creditor and former owner, that the property, with its extensive dairy and breeding operations, had been sold.”
Government
Nationals MP facing threat of bankruptcy after claims from former business partner's family
8 November 2018
The Sydney Morning Herald reports that “a National Party MP representing a must-win electorate is facing the threat of bankruptcy after refusing for years to pay the family of his dead business partner hundreds of thousands of dollars.”
World
North America
Retail
13 November 2018
Business Insider reports that “Sears’ creditors are demanding that the company shut down all its remaining stores. The retailer’s plan to survive bankruptcy is “nothing more than wishful thinking” and “an unjustified and foolhardy gamble with other people’s money,” a group of unsecured creditors has declared in a new filing.”
Manufacturing
DME goes into receivership, local impact unknown
28 November 2018
Brew News reports that “the announcement that one of North America’s largest brewing equipment manufacturers is in receivership is set to have a major impact on a number of Australian breweries-in-planning.”
Toshiba to shed troubled assets, cut 7,000 jobs as part of new 5-year strategy
8 November 2018
The Australian Financial Review reports that “Toshiba Corp is liquidating its British nuclear power unit and selling its US liquefied natural gas (LNG) business, as the once-mighty industrial conglomerate seeks to unload troubled assets and regain investors' confidence.”
Europe
Legal
Court shuts down fraudulent interior design company
28 November 2018
Mirage News reports that “interior design company has been wound up in by the courts after it was found to be used as a vehicle to fraudulently secure credit.”
Injury claims boss jailed after removing company funds before closure
15 November 2018
Mirage News reports that “personal injury claims boss jailed for 21 months after fraudulently removing company funds in the months before the courts would make a winding-up order resulting in the closure of the business.”
Transport
Piaggio Aerospace declares Insolvency
30 November 2018
Australian Flying reports that “Italian manufacturer Piaggio Aerospace declared insolvency on 22 November, asking for extraordinary administration that would allow them to restructure.”
Communications
Marketing bosses landed with six-year disqualifications
28 November 2018
Mirage News reports that “two marketing bosses disqualified for total of 12 years after causing their company to pay more than £830,000 to businesses they had connections with. With offices in London and Sheffield, White Space Communications Ltd was incorporated in September 2000, providing web design and marketing services.”
Investment
Financial investor banned for 11 years after abusing clients’ funds
6 November 2018
Mirage News reports that “a financial investor has been disqualified for 11 years after he abused thousands of pounds worth of client’s funds.”
Entertainment
Soccer-Parma on course for Europe three years after playing in fourth tier
30 November 2018
Eurosport Football reports that “only three years after being declared bankrupt and demoted to the fourth tier of Italian football, a re-born Parma are on course to return to the European stage where they excelled in the 1990s.”