Unsecured Airwell creditors may get close to full refund

By Chris Nicholls

MELBOURNE: The future may not be as bleak as some think for Airwell employees and service agents, with Deloitte senior partner Timothy Norman saying staff may get 100 cents in the dollar, with unsecured creditors similarly accommodated.

Speaking with Current.com.au, Norman said while he could not say with “absolute certainty” as he had not received a copy of the proposed direction for former distributor ECP, both employees and other creditors would receive an “attractive proposal”.

“It is unknown … but I understand that if the parent puts forward a proposal, it would aim to be an attractive proposal for the employees and unsecured creditors.

“The expectation is that all employees would get 100 cents, and I just don’t know the level that’s unsecured, but I expect it would be similarly attractive,” said Norman.

While the final fate of ECP is uncertain, creditors will get a chance to meet with the administrator in a formal introduction and appointment this Friday.

However, the ultimate decision on ECP’s future will rest with creditors in a meeting likely to be held in the week starting 18 August, Norman said.

Before then, Norman said he expects to receive what is known as a ‘deed of company arrangement’ from ECP’s parent company, which will outline a possible future direction.

“It is my understanding that the parent company of ECP are [sic] intending to propose a deed, which may result in the return to the unsecured creditors of the company,” he said.

Other options for ECP include returning the company to its current directors, a situation Norman described as “very unlikely” or placing the company into liquidation.

Regardless of which option eventuates, any deed of proposal will be detailed in a report to creditors in a report, sent out to creditors a full five business days before the August meeting, said Norman.

The report will “outline my review of the business and affairs of the company prior to its entering into administration and giving my opinion as to which of those three options might produce a better outcome for all creditors”, said Norman.

He said it will be up to the creditors at the meeting to decide the company’s fate.

However, Norman also revealed he will be placing ECP’s inventory up for sale during this week.

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