Sims IGA Plus Liquor stores in Footscray and Werribee had failed to pay rent or a number of suppliers for up to a year and had sunk more than $10 million into debt by the time they were placed under administration.
Star Weekly last month revealed that grocery giant Metcash, which was owed more than $3 million dollars, had called in administrators to manage the sale of the troubled businesses.
Administrator Shane Cremin of Rodgers Reidy confirmed on Monday that they have accepted offers from existing players in the grocery market to buy the two stores.
They are continuing to investigate how operators racked up combined liabilities of $10.4 million – $6 million for the Footscray store and $4.4 million for Werribee – including $1.6 million in unpaid superannuation and leave entitlements for staff.
Secured creditors Metcash and ANZ are first in line to recoup $4.1 million from any sale.
A further $860,000 is owed to the Australian Tax Office and almost $700,000 in unpaid rent and outgoings is owed to the landlord of the Footscray store.
Creditor meeting minutes show unpaid suppliers have also lodged claims in the hundreds of thousands of dollars, forming a substantial portion of the $4.7 million in unsecured claims.
More than 160 staff who have been left in limbo over recent weeks should soon discover whether they will be retained by the new owners, however creditors may face a longer wait to find out whether they will receive any money.
Mr Cremin said separate offers had been accepted on each of the stores from two different buyers, yet final details were still being ironed out before contracts were signed.
“We will finalise the sales then distribute the sale proceeds, but there’s still a lot to work out.”
Mr Cremin confirmed investigations are continuing into how the companies had fallen so deeply in debt when they were trading at approximately breakeven.
Creditors have been told that although it is not yet clear whether the companies had traded while insolvent, each had recorded a “deficiency of assets” in financial statements.
Mr Cremin said further investigations are likely to form the basis of future legal proceedings.
