Major Australian fruit exporter JAK Fruit went into voluntary administration this week with debts of over A$10m (US$9.25m), but owner Jason Kotz told Fruitnet.com he hopes the company can come through the financial mire “smarter and stronger”.
The Mildura-based company, a major exporter of grapes and citrus, was forced to call in Melbourne-based insolvency company BRI Ferrier on Tuesday following the refusal of a major financial institution to continue to support its sizeable debt.
Wayne Benton of BRI Ferrier told local newspaper the Sunraysia Daily that JAK Fruit owed its unsecured creditors (growers) A$4.1m and its bank around A$6m.
But Mr Kotz said he is hopeful that the company can continue to operate and pay back its growers.
“There is a commitment in process to pay all of our unsecured creditors 100 cents in the dollar,” Mr Kotz told Fruitnet.com. “We don’t want to walk away from any of our responsibilities.”
JAK Fruit has two meetings with its creditors in the coming weeks, and only after the second one in a month’s time will the company know its fate.
“The creditors will then decide whether we’ll be able to continue operating,” said Mr Kotz. “My aim is to keep this business going and to come through this smarter and stronger, but the decision as we move forward is out of our hands.”
It is estimated that around 50 to 60 growers are owed money, and Mr Kotz said that payment could be generated through any profits of the business going forward.
“The situation has caused a significant amount of pain in the local community,” he acknowledged. “Growers have been unpaid and it is difficult to come to terms with that, but we want to put it right.”
While JAK Fruit has a stake in farming, owning 80ha of citrus, almond and avocado orchards in the Sunraysia region, Mr Kotz said he hoped to avoid selling these assets.
He told Fruitnet.com it was difficult to pinpoint reasons for the company’s financial problems, citing “a raft of issues”. However, the recent tough conditions in terms of production and trading for Australian exports have been a key factor.
“It’s happened at a particularly bad time,” Mr Kotz said. “Export volumes of grapes have been well down and growers in the community are struggling. It’s been a challenging year for all exporters as there just hasn’t been the throughput.”
While JAK Fruit is still able to continue trading fruit, he noted that there is currently very little product available as the grape season has finished while the export volumes of citrus are around three weeks’ away. “We are hoping to keep working with our established suppliers `for citrus` but a lot of water needs to go under the bridge before this is confirmed,” Mr Kotz said.
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