BUSINESS FAILURES – AUSTRALIA

Ailing Virgin’s crash landing

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Original article by Simon Benson, Robyn Ironside
The Australian – Page: 1 & 4 : 21-Apr-20

Virgin Australia’s creditors are unlikely to recover much of the money they are owed after the struggling airline was placed into voluntary administration. Virgin’s international shareholders agreed to the move after the federal government rejected a request from the carrier for a $100m emergency grant. Private equity firm BGH is believed to be among two potential buyers of Virgin, which could be revived as a low-cost airline focusing on the domestic market. Labor and unions have urged the government to take a stake in Virgin to ensure that it survives.

CORPORATES
VIRGIN AUSTRALIA HOLDINGS LIMITED – ASX VAH, BGH CAPITAL PTY LTD, QANTAS AIRWAYS LIMITED – ASX QAN

Insolvency law change to head off avalanche

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Original article by Matthew Cranston
The Australian Financial Review – Page: 6 : 23-Mar-20

The federal government will make temporary changes to laws governing insolvent trading in response to the pandemic. Amongst other things, directors will be exempt from personal liability if a company is found to be trading while insolvent, while the threshold at which creditors can initiate bankruptcy proceedings against a company will be increased from $5,000 to $20,000. These measures will remain in place for at least six months.

CORPORATES
AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIA. DEPT OF THE TREASURY

Saviour found for Jeanswest chain

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Original article by Eli Greenblat
The Australian – Page: 19 : 26-Feb-20

The Australian subsidiary of Hong Kong-based Harbour Guide has secured a deal to acquire failed clothing retailer Jeanswest. Harbour Guide is owned by businessman Chun Fan Yeung, who is a shareholder in Jeanswest’s former parent company, Howsea. The sale to Harbour Guidance Pty Ltd is conditional on landlords agreeing to new lease arrangements for Jeanswest stores. The deal will result in up to 106 stores remaining open, which will allow about 680 employees to keep their jobs.

CORPORATES
JEANSWEST CORPORATION PTY LTD, HARBOUR GUIDE LIMITED, HARBOUR GUIDANCE PTY LTD, HOWSEA LIMITED

Recipe for disaster: TV chef’s empire crashes

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Original article by John Ferguson, Rachel Baxendale
The Australian – Page: 1 & 6 : 11-Feb-20

KordaMentha has been appointed as the voluntary administrator of 22 businesses in the Made Establishment Group, which was founded by celebrity chef George Calombaris. KordaMentha has issued a statement in which it notes that the business had been impacted by a wage underpayments scandal in 2017, which resulted in Made Establishment being fined $200,000 by the Fair Work Commission. The collapse of Made Establishment will result in hundreds of jobs being lost, with most of its restaurants having already ceased trading.

CORPORATES
MADE ESTABLISHMENT PTY LTD, KORDA MENTHA AND COLLEAGUES PTY LTD, AUSTRALIA. FAIR WORK COMMISSION

Even denim’s got the blues as Jeanswest collapses

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Original article by Eli Greenblat
The Australian – Page: 15 : 16-Jan-20

Peter Gothard and James Stewart of KPG have been appointed as voluntary administrators of the Australian division of Jeanswest Corporation. The clothing retailer boasts 988 employees and 146 stores across Australia, and is the latest casualty of the downturn in the retail sector. Gothard says the administrators will seek expressions of interest from potential buyers of the business, which was founded in 1972. The first creditors’ meeting is scheduled for 28 January. Jeanswest’s New Zealand arm is not affected by the collapse.

CORPORATES
JEANSWEST CORPORATION PTY LTD, KPMG AUSTRALIA PTY LTD

Harris Scarfe to cut 440 jobs, shut 21 stores

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Original article by Lucas Baird
The Australian Financial Review – Page: 14 : 7-Jan-20

Failed department store group Harris Scarfe will be restructured prior to its sale. This will result in the closure of 21 stores nationwide, including eight in New South Wales and three in Victoria. This will leave 44 stores for prospective buyers of the group, which collapsed in late December. The store closures will result in the loss of about 440 jobs; Shop, Distributive & Allied Employees’ Association secretary Josh Peak says the union’s priority will be to ensure that retrenched workers receive their full entitlements.

CORPORATES
HARRIS SCARFE HOLDINGS LIMITED, SHOP, DISTRIBUTIVE AND ALLIED EMPLOYEES’ ASSOCIATION, DELOITTE RESTRUCTURING SERVICES, ALLEGRO FUNDS PTY LTD, GREENLIT BRANDS

New ACCC case targets Google

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Original article by Paul Smith, Yolanda Redrup
The Australian Financial Review – Page: 19 & 22 : 5-Nov-19

The Australian Competition & Consumer Commission is preparing an antitrust case against Google over the collapse of mobile advertising group Unlockd. The ACCC’s case will centre on whether Google’s conduct in relation to Unlockd constituted a breach of section 46 of the Competition and Consumer Act, which prohibits the misuse of market power. Google is also the subject of antitrust proceedings in the US.

CORPORATES
GOOGLE INCORPORATED, UNLOCKD PTY LTD, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, ROKT PTY LTD, FITBIT INCORPORATED

Former Arrium directors face recovery action

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Original article by Simon Evans
The Australian Financial Review – Page: 16 : 22-Jul-19

Insolvency firm KordaMentha has launched legal action in the New South Wales Supreme Court in an attempt to pursue former directors of failed steel firm Arrium for monies owed to its creditors. Arrium was placed in administration in April 2016 owing $2.8 billion to banks and noteholders. KordaMentha then operated the business as administrators until it was purchased by British billionaire Sanjeev Gupta for around $700 million in August 2017.

CORPORATES
KORDA MENTHA AND COLLEAGUES PTY LTD, SUPREME COURT OF NEW SOUTH WALES, ARRIUM LIMITED

Builder insolvencies soar, subbies call for safety net

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Original article by Michael Bleby
The Australian Financial Review – Page: 29 : 6-Jun-19

Data from the Australian Securities & Investments Commission highlights the impact of the slowing residential market on the construction industry. Some 153 building firms across Australia were placed in administration during March, including 64 in New South Wales. Subcontractors have backed a 2017 proposal to establish deemed statutory trusts, which would ‘ringfence’ payments to subcontractors for projects worth more than $1m.

CORPORATES
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, SUBCONTRACTORS ALLIANCE, HOUSING INDUSTRY ASSOCIATION LIMITED, SCHIAVELLO GROUP PTY LTD, AUSTRALIA. OFFICE OF THE AUSTRALIAN SMALL BUSINESS AND FAMILY ENTERPRISE OMBUDSMAN

Missing Guvera boss Herft says he’s very easy to contact

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Original article by Liam Walsh
The Australian Financial Review – Page: 17 & 24 : 26-Apr-19

The liquidators of failed music streaming company Guvera state that they have found it difficult to contact its CEO, Darren Herft, according to a creditors’ report. Glenn Spooner and Daniel Juratowitch of Cor Cordis say they have contacted the Australian Securities & Investments Commission for assistance on the matter, but that it has not yet been able to help them. However, Herft has rejected suggestions that he is hard to contact, saying he is in the US at the moment, where he intends to relaunch Guvera.

CORPORATES
GUVERA AUSTRALIA PTY LTD, GUVERA LIMITED, COR CORDIS PTY LTD, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AMMA PRIVATE EQUITY PTY LTD