Paper halt hits rescue
DISTRESSED commercial printing group Geon is on the verge of shutting down after some paper suppliers have refused to deliver stock.
The supply halt has forced receivers to undertake an urgent appraisal of the business in order to prevent plant closures and up to 800 job losses across Australia and New Zealand.
Receivers McGrathNicol said there was negligible credit risk for suppliers given payments were guaranteed by the receiver.
While McGrathNicol did not name the supplier, official accounts show the key suppliers are Visy, Fujifilm and paper group K. W. Doggett.
"We are terribly disappointed at this outcome as the suppliers' actions add to the uncertainty for creditors and employees," Shaun Fraser, partner at McGrathNicol said.
Geon Group is owned by US private equity group KKR and Australian-based private equity firm Allegro funds.
The pair have owned the company for less than six months after purchasing it from Lloyds Banking Group as part of a portfolio of distressed loans worth $350 million.
KKR offered to buy back parts of the group after it appointed McGrathNicol, , which it is entitled to as the major creditor.