STARLEATON DEBTS TOTAL $17.5 MILLION+
Stricken wide-format supplies business Starleaton went into administration with debts totalling $17.5m, and with only $1.93m in realisable assets unsecured creditors are facing the prospect of zero cents in the dollar on their outstanding invoices.
The administrators are recommending liquidation of the business.
Trade creditors are owed $3.56m. SDS family trust is owed $6.56m, company founders Peter and Lea Eaton are owed $5.4m plus interest
Stock value is around $4.3m, but that is almost all unavailable to creditors as it has PMSI purchase money security interests on it. Fixed assets are negligible at $400,000. Debtor invoices, factored by Octet Finance, stand at $1.58m, but Octet has $1.1m of those, and some are from businesses that are themselves in liquidation. The ultimate holding company SDS Bidco owes Starleaton $6.3m, but SDS Bidco is itself in administration.
Apart from the family, Octet and the NAB are the other major individual creditors. Behind them in the queue, and in front of any other unsecured creditors, stands the ATO, which is owed $623,000, and employees, who are owed some $1.3m, which includes unpaid wages, super, long service leave and annual leave. Most of that, apart from the Super, will be paid under the Fegs scheme, the tab picked up by the taxpayer. Amex is owed $474,000.
Starleaton’s suppliers are in for significant amounts, Canon Production Print topping the list with $512,000 outstanding, followed by Swiss flatbed cutting developer Zund at $385,00, and German media supplier Neschen at $355,000 and Elof Hanssen $123,000.
Epson is owed $92,000, Ball & Doggett $85,000, Felix Scheller $53,000, Neenah paper $47,000, Permalite $36,000, Hahnemuhle $30,000 and Mimaki $27,000 and Brett Martin $20,000. Starleaton also owes courier company UPS $21,000.
The company owes industry trade suppliers association Visual Connections some $11,000.
The second creditors meeting is set for 15 March, by which time the administrators from Cathro Partners hope to have sold the business, which had revenues circa $20m, and operated from facilities in virtually every capital city in the country.
Starleaton is seeing some of its 70 staff exit the business as they seek income in the current uncertain climate.
The company was founded in 1978 by Peter and Lea Eaton, and has been run by one of their sons, Ben Eaton, for many years. It moved into a new national head office in Artarmon just a year ago.
Starleaton operated in the sign & display segment, a strong but increasingly competitive market. The two big national printable materials suppliers – Ball & Doggett and Spicers – both of whom are backed by giant Japanese paper conglomerates, have moved into the market in recent years, as commercial papers growth has plateaued at best – and there are eight or ten national wide format consumables suppliers, including the likes of Orafol, Spandex, Avery Dennison, Ricky Richards, HVG, Graphic Art Mart, Amari, Kissel + Wolf, and Smartech, most of whom have significant backing. In addition Currie Group with its massive reach in the commercial world has become a major hardware supplier, and virtually all the hardware developers also sell consumables to their customers.