Australian ready-made meal service Fast Fuel Meals has collapsed into administration, with its administrator revealing more than $20 million in secured, priority and unsecured creditor claims.
Fast Fuel Meals Holdings Pty Ltd appointed administrator Dane Skinner of Raft Consulting on September 8, according to an ASIC notice, with trading ceased on August 3.
The Sydney-based company sold ready-made meals through major supermarket chains including Woolworths and IGA, and was previously stocked by Coles and Harris Farm Markets.
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The first meeting of creditors was scheduled for September 18.
Speaking to 7NEWS.com.au on Thursday, Skinner revealed the company’s latest creditor figures, with $7.43 million owed to secured creditors, $879,303 to priority creditors and $12.52 million to unsecured creditors.
The figures add up to $20.82 million, although Skinner warned they remain subject to change as creditors submit proof of their debts and claims are assessed.
“We currently hold sufficient funds to pay priority creditors in full,” he said.
Priority creditors are given higher priority under insolvency law, while secured and unsecured creditors have different rights when it comes to recovering money they are owed.
The outcome for secured and unsecured creditors, “depends on the terms of the proposed Deed of Company Arrangement (DOCA),” Skinner said.
The DOCA sets out in a formal agreement how a company will deal with its debts and allows it to potentially continue operating rather than being immediately wound up.
Asked what led to the company entering administration, Skinner said his preliminary investigations had found the company was “loss making”.
The director had been in talks with a consortium of suppliers and members of management familiar with the business about a potential acquisition, the administrator confirmed.
Skinner said the new ownership was intended to “recapitalise the business, strengthen its operations, and improve its trading performance”.
In simple terms, the proposed deal would bring new money into the business in an attempt to make it financially viable and get the company back on track.
A voluntary administrator was then appointed to assess the available options and seek the best possible return for creditors.
The administrator has not said whether the proposed acquisition has been completed.
For employees, the position appears more settled.
“All employees with the exception of one are unaffected,” Skinner said.
“Employees and their accrued entitlements were assumed by the purchasing entity before the administrator was appointed.”
But it remains unclear how much of the nearly $20 million claimed by secured and unsecured creditors will ultimately be recovered.
