PC Company looks for alternative to receivership

By RICHARD WOOD

Two weeks after The PC Company stopped trading, many customers are none the wiser about the state of PCs in for repair, or about orders paid and not delivered.

Managing director Colin Brown issued a statement today, saying the firm will not trade again, but will not go into receivership. Instead it will seek to negotiate a "Scheme of Arrangement" with creditors.

"At this point, our efforts must be to extract maximum value from The PC Company for its creditors. The advice we have is that receivership might not do this," he said.

One of those creditors is Microsoft, belived to be owed around $200,000.

Spokesman Brett Roberts said he could not confirm the level of debt but that Microsoft supports any move that maximises the return to creditors.

He said Microsoft had had a long and successful relationship with The PC Company and Colin Brown and he regards him as an ethical businessperson.

Another major creditor is distributor Ingram Micro which director John Dunbar said is owed "hundreds of thousands" of dollars, and will be very interested to see the scheme being proposed. He said Ingram has not yet sought liquidation of the firm and it would make a decision on its course of action in the coming week.

The Herald continues to receive calls from people who have been unable to communicate with The PC Company or Brown.

Murray Huband, who ran a franchise of The PC Company in Whangerei, said the whole situation is "a bit of a mockery".

He renamed his business The PC Factory last week but said he made the decision to cut loose a couple of months ago after he got fed up with slow supply and "had an inkling there were finanical problems".

Huband said he has been trying to get computers back for customers that had been sent to The PC Company in Hamilton for repair.

Matt Tyrie, a customer of the firm's Nelson branch, disputes a statement from Brown reported in the Herald where Brown said he was unaware of any customers who had prepaid and not received goods.

Tyrie told the Herald he paid half the money, $2000, for a PC on the last day the firm traded on Friday September 5th. He went back to pay the remainder on the Saturday, to find the store closed.

He said the ex-manager of the Nelson store later emailed Brown to see if it was possible to ship the order, and received a reply that discussed whether it would be covered by a warranty.

"So obviously he was aware there was one prepaid," said Tyrie.

Christopher Wragg, of Auckland, said he purchased a 256Mb memory upgrade on August 28th , which was debited from his Visa card that day. He said the goods have not arrived.

Consumers Institute CEO David Russell said it is well beyond time for laws dealing with prepayments.

"It is so important that we get a law in NZ where, for any payment made before delivery, that money should go into a third party trust account and be available to the consumer should the company go belly up," he said.

Meanwhile a number of ongoing problems customers have had with The PC Company have come to light.

In one case a South Auckland student, Nora Glassie paid $1777 for a PC in July. The PC didn't work on arrival and she returned it.

Glassie said the firm refused to replace it at the time, saying it could fix it, and it still has it. She said she was promised a refund twice by two different managers, the second time was two days before it ceased trading.

Glassie said the experience has destroyed her motivation to continue her computer course for which she had taken a student loan. She also took a personal loan for the computer and is determined to get a resolution.

"I'm not going to kiss $1700 away. I have serial numbers right down to the boxes they came in".

Creditor queries should be addressed to:

The PC Company Ltd Scheme of Arrangement

C/- Tompkins Wake Lawyers

WestpacTrust House, 430 Victoria Street

PO Box 258

Hamilton