A Kiwi-owned business praised for its innovation and fast expansion has failed and receivers are now in charge.
ASB is owed $7.3 million plus interest from a once award-winning cement business which it put into receivership on the weekend.
Drymix Cement, a bulk cement import and distribution business, was put under on Sunday after the bank exercised its powers via its general security deed, according to Grant Thornton's Malcolm Moore and David Ruscoe.
They are now in charge and say the debt to the bank is $7.3m but it was unlikely that would be paid in full.
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"Following advice that the company was insolvent, the company's shareholders requested that the general security deed holder appoint receivers," their report said referring to ASB.
"The assets of the company include cement stock, debtors, equipment - debaggers, silos, concrete pads and other equipment - and vehicles: tankers, trucks and forklifts," the receivers said.
"As at April 21, the book value of the company's assets totalled $9,543,009," they said.
But $5.8m of that was owed to the company by related parties.
"A significant portion of this debt is owed by Drymix NZ which was placed into receivership on June 8 on the basis that it was insolvent. Accordingly, we do not expect the majority of these related party receivables will be collectable," the receivers said.
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In 2014, Drymix won a Mitre 10 award, praised for its innovating and its staff appeared at a gala dinner celebrating. Mitre 10 and Hammer Hardware advertised it as exclusively available at its stores.
"In June 2014, at Mitre 10's Conference and 40th birthday celebrations in Los Angeles, Drymix say they were honoured and absolutely delighted to be recognised by Mitre 10 and awarded with building products supplier of the year," Drymix says on its web site.
"To also be awarded the inaugural innovation award for our Super Easy Mix in the Bag range was one of the proudest moments in our company's history. We are constantly striving to improve our product offering and service and are thrilled that this has been recognised by New Zealand's pre-eminent home improvement and garden retailer," Drymix said.
Companies Office records show Drymix Cement directors are Hunter Gordon Crossan of Greenhithe, Leslie Gordon Crossan of Mairangi Bay and Simon Anthony Trower of Albany. The directors were co-operating fully in making available the required information, the first report said.
Gordon Crossan said today he did not want to say what had gone wrong or make any public comments about the situation he or the company was now in.
The receivers are continuing to run the business, hoping to sell it as a going concern. Discussions with interested parties are ongoing, they said.
Accounts showed a $4m book value deficit but a $6.8m realisable value deficit.
Realisable value of assets was only $1.5m compared with the book value of total assets at $9.5m. Liabilities of $8.3m were listed as both the book value and realisable value.
"Based upon the estimated assets' realisations, it appears that no funds will be available to meet the claims of unsecured creditors as it is estimated that there will be insufficient funds available to repay the general security deed holder in full," they concluded.
Drymix said it sold "exceptional quality product at a very competitive price." It is a family-owned business established in 1992 and proudly 100 per cent New Zealand owned and operated.
It manufactures and supplies dry mixed concretes, mortars, plasters, sands and landscape products and has depots in Bluff, Timaru, Christchurch, Wellington, Feilding, Tauranga, Hamilton and Auckland.
Tankers deliver its product nationwide to the independent ready-mix concrete market and the cement is available in bags or bulk.
Publicity about the business said it had humble beginnings when Gordon Crossan initially
operating from a shed belonging to the power board in central Feilding.
With his wife Patricia's assistance, the first tiny plant was established within three weeks, manufacturing and bagging easy-to-mix and quick-setting concretes and mortars, an industry article said.
About four years later, the business shifted to the industrial hub of Feilding and went on expanding from there - until Sunday.