Rail firm managers face possible litigation as bulk train sector loses one of its few competitors
By Rob McKay | July 24, 2013
There appears no way back for failed rail firm El Zorro Transport or from the resultant consolidation of the rail freight sector that the development implies.
El Zorro Director Ray Evans put the rural-focused bulk train operator into administration on June 14, with early reports putting debts at upward of $10 million, with staff owed $1.4 million.
However, David Hurst, a Director of liquidator HoskingHurst, says the full figure is “closer to $20 million” and the shortfall of employee entitlements including superannuation is more like $2 million.
The push to liquidation came from Consolidated Rail Leasing.
HoskingHurst has sought debt details from creditors, including giant agribusiness Cargill, which is owed $6 million
El Zorro’s biggest contracts were with Cargill and mineral sands firm Iluka, both of which were lost to Pacific National before it collapsed.
Hurst says the officers of El Zorro faces potential litigation as HoskingHurst probes its actions immediately before administrators were appointed, particularly the sale of assets and a licensing agreement with a related company for the use of accreditation.
