The future of one of Compaq's top five NSW resellers remains unclear, following the number one-rated PC manufacturer's decision to appoint an administrator to Future Technologies. Administrator Greg Hall of Price Waterhouse took the reins of Future Tech on April 29, after Compaq exercised its debenture rights to settle unpaid debts.
According to Hall, he was brought in by Compaq after Future Tech defaulted on payment. Compaq spokesperson Anne Eckert says Compaq has been working with Future Tech to assist the company through financial difficulties, but enough was enough. "We'd been working to try and stabilise them and put them into a profit situation, but it just became commercially unfeasible for us to continue with that."
Future Tech is believed to have a lengthy list of creditors, with Hewlett-Packard thought to be in their number. Future Tech's debt is also unknown. Hall says he will have a clearer picture when he presents his report to creditors on May 24.
Eckert is also unwilling to discuss Future Tech's level of debt. "Obviously that has an impact on what happens if there's a buyout, but we're working from the basis that it is going to be sold and therefore the debt's not an issue." Accordingly, Hall says he has been appointed as administrator to take possession of the business and continue it as a going concern, in order to sell or restructure it.
The appointment of an administrator represents the lesser of two evils for Future Tech, as under its debenture agreement Compaq also held the option of appointing a receiver. "I suggested they appoint an administrator rather than a receiver because it allows greater flexibility in the type of solution that we can bring to the company," said Hall. "By having greater flexibility and by acting in the interests of all creditors, I'm hopeful I can provide a better solution for all interested parties."
As Hall says he is in active discussions with several potential buyers, that solution is likely to be the sale of the company. According to Eckert a sale is also the desired outcome for Compaq, which would obviously like one of their largest resellers to continue trading. "We've worked very closely with supporting the staff. Ian Penman went in there and with all the staff went through what was going to happen and why this situation had come about, and the support that we were going to provide. So we're trying to handle it in a way that it's the best possible outcome for everyone."
Eckert says Compaq is continuing to support Future Tech with product and services. Hall says that business is continuing as usual, with no retrenchments. "It's trading very well. Since I've been appointed, our sales are well above budget."