By Michael Turner - Updated on February 10, 2022Background and Our appointment
Placeholder Printing operated a printing business, providing both offset and digital printing services to Customers.
Placeholder Printing had numerous secured creditors with a variety of collateral including:
After making an initial assessment we categorised the assets as mentioned in Table 2 and formed the following strategies to realise these assets:
Upon appointment, we immediately took action to catalogue the assets of Placeholder Printing, arrange for a valuation of the assets on site, and determine the appropriate secured creditor for each individual asset while arranging for the collection of debtors.
The digital printing equipment was subject to leasing agreements and could not be realised for the benefit of creditors; we liaised with the relevant secured creditors, verified their security documents, and facilitated the uplift of their collateral.
We worked with Gravity Credit Management; a debt collection company associated with us to maximise the collections we could achieve from the accounts receivable.
Feedback from our valuer indicated that the equipment was primarily older, specialist offset printing equipment (and other machinery including guillotines).
The market for offset printing equipment in New Zealand is niche and suitable to a few businesses. We decided that it was crucial to achieve a sale in situ (meaning in place), and avoid a sale process where the assets are uplifted and sold, to maximise the sale value while minimising costs associated with sale (primarily costs to remove the assets)
To further complicate the matter, the creditor with the specific security interest had several items of collateral that were unclear or in dispute.
The Result
We ultimately sold the remaining assets of Placeholder printing in situ to an interested party who arranged for the assets to be removed at their cost; the price achieved by our in-situ sale was significantly above the forced liquidation value of the equipment (prior to removal costs).
The result of our sale process was a distribution to Placeholder Bank and the creditor with a specific security interest
While we were running our sale process, we were working with the director of the Company to help facilitate a refinance to settle our client’s debt, the debt owed to the bank and other creditors obligations; the distribution we paid as a result of our sale process assisted in completing this process.
The end result achieved was as follows:
- Successful sale of the assets in situ.
- Distribution to the first ranking GSA holder and a creditor with a specific security interest.
- Our appointors debt settled in full through collections of the debtors’ ledger and the successful refinance.
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