Creditors approve Tribe DOCA

Creditors have voted to approve the Deed of Company Arrangement proposed by a group of convertible noteholders that is expected to see a return to unsecured creditors of 4.97 cents in the dollar.

The deed was proposed at a creditor’s meeting today, and supported by the voluntary administrator.

Administrator Christopher Hill from FTI Consulting said it was a good result.

“This outcome means the Tribe will continue as a going concern, which is a great outcome for Tribe’s employees and customers,” he said in a statement.

“I want to thank Tribe’s employees, suppliers and customers who worked with us through the administration period.”

The Tribe Group went into administration in February with debts totalling more than $72 million, including $15 million to unsecured trade creditors and $7.9 million to the Australian Tax Office.

Under the DOCA the Tribe noteholders, including the Elsie Cameron Foundation and VBS Investments will retain ownership of the Tribe Group following the payment of $1 million, in addition to the Administrator’s unpaid remuneration and payment of priority creditors.

The DOCA will see employees paid in full.

The parties have 15 days to execute the Deed of Company Arrangement. If the Deed is not executed the companies will be placed into liquidation.

The administrators noted that since production commenced at the $35 million Goulburn Brewery, Tribe had been unable to generate significant production volume on a consistent basis to reach cash flow breakeven. The ongoing trading losses had essentially been funded via debt in the form of convertible notes in shareholder loans.

Tribe had been exploring a number of exit strategies, including a sale. A sale to RGT Capital, the largest investor in Sydney’s Young Henry’s, collapsed last year resulting in legal action with other debt holders.

The administration has seen administrators close its Stockade Barrelroom in Marrickville.

Tribe is the latest and largest in a recent spate of voluntary administrations and will have a significant impact on the industry. Brewers are reporting a tightening of trade terms with suppliers, and suppliers urging brewers to maintain communication to work through any difficulties.

Back to News