Kleenmaid kitchen empire sinks with $67m debt

…he bought the franchise in November last year, and became suspicious about the financial health of the group in December. "I'm probably down $270,000 plus expenses," he said. "I've heard nothing verbally from them since November … we still have not got official notification (of the collapse)."

The Australian
April 11, 2009

Kleenmaid kitchen empire sinks with $67m debt
Anthony Klan

THE Kleenmaid kitchen and laundry appliance empire — founded by a washing machine repair man almost 25 years ago — has been swept into administration owing $67 million.

Administrators said yesterday up to 150 staff had been made redundant, with Kleenmaid's 20 stores nationwide — which included 15 franchises — to close their doors.

"There is no intention to order any more stock from manufacturers or suppliers in the future," said Deloitte administrator John Greig.

According to Deloitte, trade and secured creditors were owed $40 million with customers who had paid deposits for products, but not yet received them, owed a further $27 million.

Kevin Rudd yesterday called for the nation to support those people who have lost their jobs in the economic downturn.

"This is a tough time for many Australians, a really tough time," the Prime Minister said. "It's a time for all Australians to gather round and support those who have lost their jobs or are in danger of losing their jobs."

Kleenmaid, which sold high-end imported whitegoods, is based in Maroochydore on Queensland's Sunshine Coast.

The group was founded in 1985 by then washing machine repairman Andrew Young, who claimed to be appalled by the quality of local washing machines at the time.

Company searches reveal Kleenmaid is owned by three separate companies, ultimately controlled by Mr Young, Richard England — who was a founding director of the group — and their wives.

Brad Young, understood to be Mr Young's brother and a sales manager of the group, resigned as Kleenmaid secretary on January 8.

One Sydney-based Kleenmaid franchisee told 2GB's Ray Hadley he bought the franchise in November last year, and became suspicious about the financial health of the group in December. "I'm probably down $270,000 plus expenses," he said.

"I've heard nothing verbally from them since November … we still have not got official notification (of the collapse)."

Mr Greig said customers who had paid deposits for goods not yet received would be regarded as unsecured creditors.

"Unfortunately, Kleenmaid will not be in a position to honour any existing warranties," Mr Greig said.

He said that, of Kleenmaid's 150 staff, about 25 would be contacted this weekend to return to the group to "provide assistance with the administration process" and to field inquiries.

http://www.theaustralian.news.com.au/business/story/0,28124,25318890-643,00.html


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