Joint administrators of the Kleenmaid Group John Greig, Richard Hughes and David Lombe have presented their report to creditors on 14 May 2009, saying the financial position of the group is worse than expected.
“Unfortunately there is no good news for employees, customers, suppliers or creditors of the Kleenmaid Group. The financial position of the group is worse than we initially expected,” said Greig.
“Kleenmaid’s most recent financial statements indicate a significant net asset deficiency in excess of $82 million. This deficiency was evident from June 2007, if not before, at which time the net asset deficiency was approximately $20 million,” he said.
Key findings of the investigation include:
• The Kleenmaid Group may have been insolvent as early as June 2007 if not earlier
• The administrators recommend the creditors vote for all 14 companies in the Kleenmaid Group to be wound up
• No proposal for a Deed of Company Arrangement (DOCA) was received prior to presenting the Administrators report
• There will be little or no dividend available to unsecured or secured creditors of any company in the Kleenmaid Group.
“This has been a very time consuming and complex administration involving many thousands of disgruntled customers, suppliers, and creditors based around the world,” said Greig.
“With 4,500 consumers affected, huge interest has been attracted from the public with more than 10,000 individual creditor enquiries in the days following our appointment. In the last couple of days, more than 7,000 copies of the 190 page creditors’ report have been posted to creditors….”
Greig mentioned that if it can be proven that the directors have breached their duty to prevent the Kleenmaid Group from continuing to trade whilst insolvent, then they may be held to be personally liable for the unpaid debts of the Kleenmaid Group.
The second creditors meeting will be on 25 May in Brisbane.