THE administrator of Hastie Group has dashed lingering hopes of substantial returns for creditors, signalling that few businesses of the once-sprawling engineering services company will find new owners.
Speaking after a creditors’ meeting in Melbourne, Ian Carson, of PPB Advisory, said Hastie’s debt bill included $100 million owed to ”many thousands of creditors”, with rural and regional suppliers particularly hard hit. This amount is in addition to $500 million owed to banks that funded its acquisition binge.
Many creditors travelled from regional areas to hear it was unlikely they would receive ”any extensive” return, given the debt to banks. These creditors included labour hire firms, and suppliers of plastic fittings and guns for fastening, some of whom were owed ”serious amounts” of up to $500,000, Mr Carson said.
”They’re really normal, ordinary businesses … and a lot of them are locals. You know, Albury and Shepparton, regional areas,” Mr Carson told a media conference after the meeting. He described the mood of the meeting as ”sombre”.
Mr Carson said of the 44 businesses under Hastie’s control, just five had been sold for a combined sum of less than $30 million, and another one or two may be sold for modest amounts.
Receivers and managers McGrathNicol, appointed by Hastie’s banks, have taken charge of Hastie’s stronger assets, but Mr Carson was downbeat on the prospect of substantial returns from the sale of those companies.
”It’s hard to imagine there being a material return even after McGrathNicol,” Mr Carson told BusinessDay.
Asked whether he had greater
insight into the cause of Hastie’s collapse, Mr Carson said: ”There have obviously been some failures, whether it’s corporate governance or other things.”
He estimated about 1200 jobs had been saved across Hastie’s local workforce, now under PPB’s remit, of the 2700 stood down, excluding the 1800-odd at companies taken over by McGrathNicol.
A spokeswoman for McGrathNicol said yesterday there was no update on its sale process for Spectrum Fire and Safety, Hastie Services, industrial refrigeration systems company Gordon Brothers Industries and Austral Refrigeration. Austral was for sale when Hastie collapsed.
The secretary of the Plumbing Trades Employees Union, Earl Setches, said the vast majority of its members had held onto work and their entitlements in Victoria. He said of the 600-odd Hastie workers in the state, just a handful were now out of work. Of the 350 members directly affected in NSW, he estimated 300 were back in work.
Hastie had about 7000 workers globally when it collapsed last month, after the discovery of a long-term accounting ”irregularity” foiled a recapitalisation plan.
Mr Carson said legal action related to the collapse had not been his focus but he would be meeting with directors and shareholders in the months ahead. Listed litigation funder IMF (Australia) and law firm Slater & Gordon have confirmed they are keeping an eye on the collapse.
There was a 150-day extension sought for the convening period before the next creditors’ meeting, Mr Carson said.
This story Administrator ready to work first appeared on Nanjing Night Net.