Stockford slumps into administration
The troubledStockfordgroup has fallen into voluntary administration after the collapse of a last ditch attempt to sell off some of its financial planning businesses to rival dealership Investor Group (IGP).
Stockford’s directors announced the move yesterday after making the decision at a board meeting last Sunday.
A statement distributed by the group says it regretted the action, but considered it the only remaining option after the failure of exhaustive efforts to revive the company.
Last month, Stockford revealed it was locked in negotiations to sell some of its practices to IGP.
But the negotiations collapsed after failing to win over the principals of Stockford practices. Stockford says the great majority of principals did not support the deal.
It is understood IGP had offered Stockford a cash sum, as well as shares in IGP, for each Stockford practice choosing to switch over to the group. The dealer group also offered IGP shares to individual principals who chose to make the move.
Stockford had also given its principals the option to buy their businesses back directly from the group. However this option too appears to have been rejected by the principals.
Mark Mentha and Mark Korda, who oversaw the break up of Ansett, have been appointed as Stockford’s administrators.
They say their immediate aim is to organise the sale of the practices within the group. They say Stockford will continue to operate as normal until the future of the company is assessed.
Stockford listed on the stock exchange in November 2000 after accounting and financial planning firms sold their businesses to the group in exchange for shares.
Shares in the group, which reached above $2.00 in early 2001, have traded for as little as three cents in recent weeks.
A meeting of Stockford’s creditors has been scheduled for Friday this week.
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