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Brothers Neilsen to be liquidated


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Contact: Karina Randall
Deloitte
Media & Communications
+61 (0) 414 823 712

Friday 27th June 2008: Brothers Neilsen was placed into liquidation yesterday after the Deed of Company Arrangement was terminated by the Deed Administrator, John Greig, Partner of Deloitte Corporate Reorganisation Group.

Mr Greig stated that it became apparent that the terms of the Deed of Company Arrangement (DOCA), as accepted by creditors in January 2007, were not capable of being successfully completed because of the difficult trading conditions being experienced by the business.

The Brothers Neilsen Directors requested that a meeting of creditors be held to vary the terms of the DOCA. In the accompanying report to creditors, Mr Greig outlined that a sale contract that had been signed in May 2008 by the Directors of Brothers Neilsen was to be put to a meeting of creditors today to vary the terms of the DOCA.

Mr Greig stated that after releasing his report, he established that the required funding to complete the sale contract had not been finalised by the Directors who indicated that further delays were expected.

Mr Greig said, “I became concerned that whilst these delays continued, the financial position of Brothers Neilsen would continue to deteriorate together with the position of all those creditors who supply goods and services to the business.”

“This move protects the creditors position from deteriorating further.”

Mr Greig stated that it was clear from the Directors that there was no prospect that either the outstanding or future DOCA contributions would be paid in full or that the conditions precedent in the sale contract would be satisfied prior to the meeting of creditors today to enable creditors to consider the proposed variations to the DOCA.

“As of close of business on Friday 27th June, we anticipate that all ten stores will close,” Mr Greig said.

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