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RUTHERGLEN’S Buller Wines may be wound up if creditors accept the recommendation of administrators at a meeting in Melbourne this morning.
Failing developments, administrators Deloitte Touche Tohmatsu will advise creditors they would be best served through winding up the fourth-generation family business, which went into voluntary administration in December.
Administrators said in a report sent to creditors last week contracts had been exchanged with the Judd Group for the sale of the business and its assets for a purchase consideration of $3.9 million, although completion of the sale depended on pending liquor licence transfers.
During the sales process, which began in February, four indicative offers were received.
Three bidders were selected as preferred bidders but two withdrew.
Deloitte Touche Tohmatsu’s report estimated Buller Wines employees, as priority creditors, and secured creditors would receive a likely dividend of 100 cents in the dollar, while unsecured creditors might expect a distribution of 13.7 to 30 cents in the dollar.
Deloitte Touche Tohmatsu confirmed today’s meeting, but declined to speculate on what may happen.
Administrators Salvatore Algeri and Simon Wallace-Smith said they had received unsecured creditor claims totalling $2,605,447, including an Australian Taxation Office claim of $686,740.
The ANZ bank holds a general security interest over all the company’s assets and undertakings, securing a debt of $3.959 million.
An oversupply of grapes and wine, as well as the high Australian dollar, had been blamed for financial problems.
The administrators said other contributing factors included an inability to sell down excessive holdings of bulk wine stock and poor production decisions.