Paradise Motor Homes
Background
Paradise Motor Homes, established in 2017, was a manufacturer of highly sought-after luxury motor homes in south-east QLD. The voluntary administration and subsequent liquidation led to the successful sale of its business assets, preserving key intellectual property and re-employment of staff.
Financial Difficulties
The company faced a number of factors contributing to its financial difficulties, including:
- Expenditure and losses incurred in re-establishing the business: The company purchased the business during 2017 and focused on completing non-profitable existing work in progress and retention of existing future orders. Coupled with this, the company honoured warranty claims, which led to significant losses.
- Supply chain issues: The loss of key manufacturing inputs during the COVID-19 pandemic resulted in significant delays in finding replacement supply and re-design of work in progress, contributing to the company’s cashflow difficulties.
- Staffing issues: The company faced significant workforce disruption upon acquiring the business, and again during the COVID-19 pandemic, affecting the company’s overall production capacity.
The company’s director sought to restructure the company by way of a deed of company arrangement, however, was not able to secure the financial support required.
Our Strategy
To maximise the potential return to creditors, we explored a sale of the company’s business and assets to an operator wishing to continue a similar business. This would enable the sale of the company’s intellectual property, plant and equipment and work in progress necessary to continue production of the company’s product range.