Maitland Leagues Club has gone into voluntary administration owing some of its creditors hundreds of thousands of dollars.
The club’s board of directors resolved at a meeting on March 11 to place the Bulwer Street business into voluntary administration appointing Newcastle-based insolvency firm Shaw Gidley administrators.
The club’s president Ben Newcombe declined to comment when approached by Fairfax Media this week, instead directing our questions to administrators Paul Gidley and Jeff Shute.
The news came just two days after Club Maitland City announced it would bankroll the Maitland Pickers for an undisclosed sum over a minimum of 30 years.
That announcement ended the team’s long time affiliation with the leagues club as its major sponsor.
Picker’s President Frank Lawler said news of the voluntary administration was a sad day for rugby league in Maitland, the leagues club staff and its patrons. “Hopefully they can trade out of this,” he said.
Despite the news, it was still business as usual for the club Mr Shute said.
“The club is continuing to trade and we are currently exploring several options that are available to the company including a possible restructure or amalgamation. Unfortunately, due to confidentiality issues I cannot make any further comment at this point,” he said.
There is mounting speculation that Club Maitland City may extend an amalgamation offer to the club following last week’s announcement of its long term, big ticket sponsorship for the Pickers. Club Maitland City President, Henry Meskauskas, said he was unable to comment at this stage.
We have the support of the employees assisting us, support from key suppliers and stakeholders to the business including Tabcorp Gaming Solutions,
Mr Shute said the club is continuing to trade as normal with all employees still working. He said unsecured creditors were owed $224,000 but would not disclose what the club owed its secured creditors.
“We have the support of the employees assisting us, support from key suppliers and stakeholders to the business including Tabcorp Gaming Solutions,” he said.
“Although the company has been experiencing cash flow issues for sometime, the records of the company report a substantial net asset position,” Mr Shute said.
“Part of our investigation will focus on trying to determine the reasons for the club’s failure. After investigations are carried out we will report to creditors within 25 business days,” he said.
A meeting of the club’s creditors will be held on March 21.
In 2008 the then cashed up club lodged a development application with Maitland City Council for a $5million project which was to include a club refurbishment and the construction of a 40-room motel on its Elgin Street property which is linked to the Bulwer Street club.