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Family firm offers $200K for Media Options against debts of $3.3m

Monday, 18 August 2014
By Patrick Howard

The remarkable acceptance of a bid by Sureprint, owned by related parties, for the failed Sydney business, in the face of a competing bid, has caused outrage from creditors and the other bidder alike.

Sureprint is run by Amrit Chandra, the sister-in-law of former owner of Media’ Options owner, Bhaskar Datta.  Together with another family-controlled business, Sydney Print Hub, it has been operating the Media Options business under licence from the administrator, Veritas Advisory, since it went into administration owing creditors $3,325,500.

The company has been the subject of a fierce legal battle as CMYKhub, which put in a bid to buy  the client list, the goodwill, the unencumbered assets and the IP of the company. That bid was approved by the creditor’s committee. This has since been overruled and Veritas has announced it will hold a meeting of creditors to resolve to accept the offer of Sureprint Pty Ltd of $213,500 in full and final settlement if the unfair preference, uncommercial transactions and related transactions claims against them.

At the same creditors meeting Veritas will ask that it be given up to an extra $46,324.50 + GST in extra payments.

Clive Denholm, CMYKhub, issued a statement expressing his frustration with the process.

We are not surprised by the actions of the liquidator as they have not honoured agreements with us. From the start of the negotiations they have seemed to have an agenda to work with Bhaskar and his related entities.
The losers in this situation is the creditors and employees. One would have to question how an interest-free 24 month payment plan for the related party is going to end, clearly if they can’t fund the purchase how do they intend to fund the ongoing business.
Our offer amounted to $360k, half up front and the balance over six months based on sales being there. If the liquidator honoured the agreement and the wishes of the creditors committee back in February this should have been concluded by now. It will be interesting to see how the creditors vote later this month.
One thing is for sure and that is the liquidator will earn additional fees for any delays.

On the face of it the transaction, if it goes ahead, has all the signs of a classic rebirthing operation where the owner, or related parties, ditches the debt, retains the business and starts up again under a new name. It is a continuing problem for the industry and will only be stopped by resolute action from suppliers.

 

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