Marketing Results, a subsidiary of ASX-listed distributor, Quadtel, placed into voluntary administration last month, has been acquired by a new company headed up by one of its former employees.
Phoenix IT, a company formed less than a month ago, has bought the Marketing Results business and its assets.
Phoenix managing director, Mark York, said Marketing Results had been bought as a going concern.
He said there was nothing in the other subsidiary that had been put into voluntary administration, Quadtel International.
York was employed as a marketing manager by Marketing Results in 1996 and spent more than three years working under Quadtel Ltd CEO, Bruce Ind.
It was Ind who notified him of Marketing Results’ availability, but York said his former boss would have no involvement in the new company.
“You have an affinity for companies you have worked with before and the basis of the [Marketing Results] business was still very good,” York said.
“The underlying problem was debt due to Quadtel and we have not acquired that debt.
“We did buy the company name but changed it because there was too much baggage. We will start clean and hopefully that will work in everyone’s favour.”
Ind said he was currently doing some interim consultancy for Phoenix while he wanted for an opportunity to get parent company, Quadtel Ltd, back on its feet.
“I’m doing a bit of work for him [York] just to help him get up to speed on what’s been going on for the past couple of years,” Ind said. “I’m talking to existing vendors to get them to rewrite some supply contracts but he already has good customer and vendor relationships.”
Phoenix will operate from the Sydney premises of Marketing Results, using its existing warehousing and distribution infrastructure. It also acquired a high volume of hardware, software and peripheral stock from vendors including Panda Software, NewSoft and NTI but York said he would be looking to bring more on board.
Having spent nine years as a Harvey Norman proprietor, York said Phoenix would look at retail distribution because he knew the business well and claimed the demise of Marketing Results had left a large hole in the market.
As previously reported in ARN, Ind said Marketing Results and Quadtel International had 18 staff when placed into administration. York said Phoenix has retained eight of those employees from the sales, warehouse and administration departments.
Meanwhile, the creditors of Quadtel International and Marketing Results — with D-Link and Primus among those out-of-pocket — are owed about $3.5 million.
Administrator, Giles Woodgate, said a deed of company arrangement had been proposed, that would return three or four per cent to those creditors if finalised.
D-Link general manager, Dominic Torre, confirmed the networking vendor was owed more than $300,000 and had been offered a settlement within the terms suggested by the administrator.
“We have not accepted at this point in time because we are going to see it out a little bit longer before coming to a decision,” he said. “The offer that has been made is unacceptable.
“We believe there are other things going on within the organisation that mean they should be able to offer us more.
“This whole situation arose prior to Phoenix coming into the picture, it was outstanding a good six months before they [Marketing Results and Quadtel International] went into liquidation.
“In some regard it’s a good scenario that they’ve gone belly-up but our insurance company won’t cover the difference and wants us to see it out until the writing is on the wall.”
Ind said Quadtel Ltd had now brought its expenses down to a negligible level because it was not operating from any premises or paying wages.
He said the company chairman was currently in Singapore negotiating the sale of its 7.5 per cent share in Hong Kong Dragon Industries (HKDI).