It might be plagued by scandals and financial woes, but the administrator for ASX-listed IP-security vendor, Zylotech, claims the outlook is optimistic.
Zylotech entered voluntary administration on August 20 after a business restructure earlier in the year failed to resuscitate the flagging company. Zylotech administrator, Andrew Needham from HLB Mann Judd, is now working through the company’s order books as well as looking at cost reduction strategies.
Needham said it was unlikely the company would be liquidated given the intrinsic value within the listed entity.
“I think Zylotech will be restructured or sold off in some way,” he said. Results will be out in six weeks time.
The vendor’s former employees, secure and general creditors, should receive all their money, Needham said. But he was unsure whether shareholders would have the same luck.
“It depends on if I can resurrect the company,” he said. Needham was optimistic about its prospects and highlighted his past experiences with the now defunct Open Telecommunications, which he managed to bring back from the brink on numerous occasions.
Avnet, which became Zylotech’s first and only Australian distributor in December last year, terminated the partnership just five months ago.
Avnet general manager, Gavin Lawless, said he saw the writing on the wall. He cited well-publicised scandals, including the departure of Zylotech’s CEO due to breaching terms of employment and significant board shuffles, as reasons the two companies parted ways