Wellington, New Zealand, September 25, 2006--The receiver for the carpetmaker Feltex is now in New Zealand to begin the process of finding a buyer. Colin Nicol from the Australian insolvency specialist, McGrath Nicol and Partners, is convinced there is an excellent chance of finding a buyer without breaking up the company, according to Radio New Zealand.
Mr Nicol says in the coming days he will talk to interested parties including the Australian company Godfrey Hirst, and the consortium of investors led by New Zealand businessmen, Graeme and Craig Turner.
Mr Nicol has dismissed Feltex's board and chief executive, Peter Thomas, and will provide a line of credit to keep it operating, after the ANZ froze its accounts. He has also said the carpetmaker failed to disclose that a sale would have required a significant write-off of the company's debt to the ANZ bank.
In a statement issued on Friday morning, Feltex said the ANZ Bank served notice on Thursday night that it was issuing a default notice demanding immediate repayment of all borrowings by Feltex. The company owes at least $NZ135m to ANZ.
The Feltex statement said: "The ANZ Bank has advised the company that it intends to appoint a receiver to Feltex Carpets Limited and to its Australian subsidiaries.
The statement added the ANZ Bank said the progress of negotiations with the Turners and Godfrey Hirst was "no longer satisfactory to the ANZ".
The ANZ's move angered Sleepyhead owners Craig and Graeme Turner, who were trying to put a rescue bid together for the company.
Craig Turner says they were in a position to meet the bank's terms and he says it has made the wrong decision.
Feltex's chairman, Tim Saunders, also said on Friday the move by ANZ to put the company into receivership was drastic and unnecessary.
Mr Saunders said last week the board could not understand why the ANZ would not accept the offer from the Turner brothers and their consortium.
The board says an opportunity to recapitalise Feltex was still viable under a $NZ51m proposal submitted by the Turners. Under the proposal, the Bank of New Zealand was to become the company's bank. The Turners proposed to provide and underwrite $NZ63.5m of capital and mezzanine debt.
An earlier bid by an Australian carpet maker, private company Godfrey Hirst, was put on hold on September 6. Godfrey Hirst said it believed its $NZ142m offer had little chance of getting shareholder approval and it would not get into a bidding war with the Turners.
The National Distribution Union says Feltex workers could be in a vulnerable position when a buyer is found.
National secretary, Laila Harre, says if the proposal offered by the consortium of investors led by Sleepyhead's Craig and Graeme Turner had been accepted, Feltex workers would have kept their current terms and conditions
But she says workers are now faced with uncertainty and major change, especially if Australian carpetmaker Godfrey Hirst buys the company.
Ms Harre says they would be forced to negotiate a new collective agreement with a new owner, rather than automatically continuing with current rates and conditions.
Feltex employs nearly 1,400 worker in Australia and New Zealand.
