THE administrator handling the collapse of the region’s largest woodchip hauling operator has revealed debts owed to creditors are not “insignificant” given the size of the business.
More than 10 people yesterday attended a creditors meeting in Mount Gambier for Pearce Logistics, which is the woodchip operation arm of the Whitehead Group of Companies.
A number of Mount Gambier businesses are owed significant amounts of money from the failed operation, which underpins more than 35 jobs.
Headquartered at Commercial Street West, the 20-year-old company has a fleet of 35 trucks that freight woodchip to the Port of Portland.
While administrator Daniel Lopresti – from Clifton Hall – is confident Pearce Logistics could be sold, he said it was not known if unsecured creditors would recoup their money.
He said the administrator had already had interest from potential buyers and they were continuing to operate the business until it was sold.
“We continue to trade the business as usual and will try and sell it as a going concern – we have already started advertising for that to gauge interest in the market.”
Mr Lopresti said a number of parties had already shown interest before advertisements were placed nationally last week.
“The parties that contacted us even before we advertised were local because they knew the business,” Mr Lopresti said yesterday.
“Now the adverts have gone out, we hope we get a lot more interest this week,” he said.
Asked about why the business collapsed, he said the Clifton Hall team was sifting through that information.
“Part of our role will look into the financial circumstances and what has caused this – we have only been in there a week so we are still looking at that,” Mr Lopresti said.
“Our primary concern will keep the business operating to achieve a sale and more information will be reported to creditors in due course.”
He said he was hoping to secure a sale in a short amount of time, hopefully within two months.
Asked how much money was owed to creditors, Mr Lopresti said he was still working through that issue.
“We will report that to creditors in more detail as we go through the administration,” he said.
“There is also some dispute about the quantum of the claims as well – it was a relatively significant business so the debts are not insignificant.”
Mr Lopresti said a number of local business operators were owed money, but were supportive of the administration process.
“This has enabled us to continue trading and they are owed some substantial amounts of money,” Mr Lopresti said.
He said the likelihood of unsecured creditors receiving their money depended on the value of the sale and a number of other factors.
“We will have a bit better idea once a sale is complete if we can achieve one,” Mr Lopresti said.
“We will report back to creditors within two months.”
He said the buoyancy of the forestry sector was helping with the sale process given the fleet of trucks were still on the road and the forecast was positive.
“Certainly the work is there and it is a good opportunity for someone in that industry or offering similar services to pick up this type of work and run with it,” he said.
Mr Lopresti said he understood the issue did not impact on other parts of the Whitehead Group of Companies.
“This is purely Pearce Logistics,” he said.
