Kleenmaid customers walk out

Secured creditors such as Westpac are owed about $28 million, while customers' deposits come to around $27 million with trade customers and suppliers owed $16 million. Administrators confirmed ahead of the meeting it was unlikely there would a return to unsecured creditors.

http://business.smh.com.au
April 23, 2009

Kleenmaid customers walk out
Fortitude Valley franchisees Marlene and Merv Kennedy say they have lost $1 million in the collapse of Kleenmaid.
Daniel Hurst

An administrator sifting through the finances of failed appliance retailer Kleenmaid says he can understand why customers who attended today's creditors meeting were so angry about losing their deposits.

Some customers walked out of the three-and-a-half-hour meeting in Brisbane after administrators confirmed they had almost no chance of recovering $27 million worth of customer deposits.

The Queensland-based appliance retailer went into administration on April 9, owing about $76 million.

Deloitte partner and joint administrator John Greig said stock currently held at Kleenmaid's Sunshine Coast warehouse was worth $2.9 million. However, the warehouse provider is owed $2.1 million, leaving little prospect for customers, who are themselves owed $27 million by the company.

"You can understand the emotions are high,'' Mr Greig told reporters after the meeting, saying there was not a lot of hope for customers.

Customer Ian Christesen said he was owed $25,000 after paying in full for Kleenmaid appliances he had never received.

"There is no point staying because there is no money," he told reporters as he left the meeting, which began at 10am.

Elizabeth Freeman, another to walk out early, said she had been left $10,000 out of pocket after sending her new Kleenmaid fridge back to the company for repairs.

"It's physically made me sick and stressed out," Ms Freeman said of the ordeal.

"I feel for the workers. Every time we went down there (to the store) they were nice and polite and tried to help."

Kleenmaid customer Margaret Olsen said she felt "dead" when she heard about the company going into administration.

She and husband Ken are out of pocket about $11,000.

"We've paid for it, why don't we get it? It's like stealing."

Mr Olsen said he had no expectations of a result from the meeting.

Brisbane franchisee Merv Kennedy said the Young brothers, directors of the company, should have been compelled to attend the meeting to explain what happened.

"They need to prove their reasons in a public court," Mr Kennedy said.

The directors have blamed the global financial downturn for the company's problems.

Secured creditors such as Westpac are owed about $28 million, while customers' deposits come to around $27 million with trade customers and suppliers owed $16 million.

Administrators confirmed ahead of the meeting it was unlikely there would a return to unsecured creditors.

Another creditors meeting is expected to be held next month to decide whether the company is liquidated.

- with AAP

http://business.smh.com.au/business/kleenmaid-customers-walk-out-20090423-ag4m.html


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