Daisytek Australia’s administrator has abandoned talk of trading out of insolvency and admitted that the company was up for sale.
The admission came after finance giant, GE Capital Finance, lined up for a share of the spoils, applying to the Federal Court to protect its rights as a $4.2 million creditor of Daisytek Australia.
According to a letter, dated May 23, from PricewaterhouseCoopers administrator, Martin Brown, to creditors, GE Capital Finance was the “major financier” to Daisytek Australia, under an agreement between the companies dated November 22, 2002.
The “fixed and floating charge” represents a mortgage of Daisytek Australia assets worth $28 million, to secure a loan from GE Capital Finance of just over $4.2 million, according to documentation lodged with the Australian Securities & Investments Commission (ASIC).
But GE Capital Finance’s stake as a creditor is now in jeopardy, as the company failed to lodge a notice of the charge with ASIC within the required 45-day time frame.
GE Capital Finance went to the Federal Court in Sydney on May 30 to apply for the extension to the lodgement deadline that is needed to enforce its claim to Daisytek’s debt against the administrator.
Meanwhile, the administrator is talking up the prospect of a sale.
Speaking to ARN on June 4, Brown said he would be asking the court to extend the deadline for setting the next creditor’s meeting, based on “reasonable interest” for either a “sale or investment”.
For more on this story, see this week's issue of ARN.