Fletchers Freighters liquidated


Fletchers Freighters to be liquidated after buyer fails to come forward to save the company

Fletchers Freighters liquidated
Fletchers Freighters liquidated
By Brad Gardner | May 12, 2010

Family-owned business Fletchers Freighters will be liquidated immediately after a buyer failed to come forward to save the company.

Meeting yesterday, creditors voted to wind up Fletchers which was founded in 1948 and went into voluntary administration in March this year.

ATN can confirm Fletchers lost a contract with National Foods and sub-contracting work with Linfox, devastating its bottom line and prompting it to call in advisory firm McGrathNicol.

While there were expressions of interest in the company, no potential buyer was prepared to make an offer.

"Throughout the administration process no viable restructuring option was put forward and we did not receive any offers to buy the transport business," Sam Davies from McGrathNicol says.

"This left us with little alternative following the creditors' resolution other than to shut the business down."

Administrators recently closed depots run by Fletchers in Brisbane, Sydney and Melbourne in a move ATN understands was because possible buyers were not interested in running them.

McGrathNicol will now liquidate the business and investigate if it traded while insolvent.

"Liquidation of the business though does not necessarily mean there will be no sale. We will now open discussions with the financiers and start planning the sale strategy and sale campaign," Davies says.

EMPLOYEES TURN TO GEERS FOR HELP
More than 100 employees—including owner Barry Fletcher and his children—were made redundant by the administrators. There were 40 redundancies and 20 resignations last week, while some staff left earlier this year.

Fletchers had a workforce of 181 staff before voluntary administrators were appointed.

Employees will need to rely on the General Employee Entitlements and Redundancy Scheme (GEERS) to secure unpaid entitlements because most of Fletchers' assets were under finance.

GEERS was set up to help workers who lose their jobs due to the bankruptcy or liquidation of their employer.

It covers unpaid wages, annual and long service leave and redundancy pay. Superannuation is not covered.

WESTPAC HAD CONCERNS
A circular sent to creditors by McGrathNicol says Westpac Banking originally approached the firm to review Fletchers’ business operations.

"The business review was to review a proposed restructure of the business together with supporting forecast financial models," the message reads.

An agreement with McGrathNicol was signed by Westpac on March 5 and by Barry Fletcher on March 9.

"The engagement was terminated on 24 March 2010 after the director [Barry Fletcher] advised Westpac that he was taking professional advice regarding placing the companies into voluntary administration," the message says.

Boasting a fleet of 80 prime movers, 135 trailers and annual turnover of $40 million, Fletchers began more than 60 years ago carting produce to Melbourne.

Barry Fletcher took over the company in 1991. As well as running an extensive warehousing network, Fletchers carried fresh produce, wine, juice, refrigerated goods and general freight.

The company last year shifted its operations after National Foods closed its manufacturing plant in Berri.


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