Buyer needed to stop ‘doomsday story’
THE search is on to find a buyer for the century-old Queensland brickworks company Claypave.
The company was put into voluntary administration in March, owing $4.9 million to the Commonwealth Bank and $700,000 to trade creditors.
It has accrued liabilities of $2 million in employee entitlements.
Liquidator Adam Ward from insolvency specialist Worrells said marketing for the sale of Claypave had started. "Once the sale is complete I am still expecting all creditors to be paid in full," he said.
All priority creditors, employees, are expected to be paid in full within the next four to six weeks and the balance after the sale is completed.
Mr Ward insisted Claypave would not be a "doomsday story" and said the sale of the business was the best-case scenario.
The company's financial problems were caused by an oversupply of bricks in a low-demand market.
Directors of the 100-year-old brick manufacturing company kept its kiln running at a cost of $100,000 in gas each month, which created an oversupply of stock.
Mr Ward said they kept making bricks despite the market downturn because directors did not want to lay-off staff.
Claypave made bricks at a higher standard and were sought by small builders and mum and dad renovators, rather than large property developers.
Mr Ward was drafted by Claypave directors early when the business hit financial trouble, a move he said potentially saved it from more significant problems.
About 60 workers from the production side of the Dinmore company lost their jobs as a result of the liquidation.
Claypave's retail store remains open.
Claypave owner John Piele, 89, has long been considered a survivor of the tumultuous brick and paver manufacturing industry.
In 2017 Claypave secured $100,000 under the State Government's Ignite Ideas fund to develop new technology for creating "long format'' clay bricks.
Mr Ward expects the sale of Claypave to be finalised by the end of the year.