Administrators believe keeping Brindabella Christian College running as usual was the best way to maximise its value and find a new owner. Photo: Michelle Kroll.
Brindabella Christian College administrators have secured an extension of time to hold the pivotal second creditors’ meeting, and funding to keep the K-12 school running while a buyer is sought to take it on as a going concern.
The Deloitte administrators had 20 days from the start of the administration to hold the second meeting but successfully applied to the Federal Court to push this out to 3 August to give it more time to conduct the administration process, including any sale or recapitalisation process.
However, the administrators can call the meeting at any time.
The administrators also went to court to seek orders removing the administrators’ personal liability relating to funding arrangements with the NAB and the ACT and Federal Governments, which are both listed as creditors for “to be confirmed” amounts.
According to the orders dated 31 March, the administrators secured an initial advance from NAB of $602,000 to pay staff wages, a funding deed with NAB and arrangements with both governments to continue paying wages and keep the school open, but no amounts are listed.
The next step in the administration is the announcement of a seven-member representative Committee of Inspection from 21 nominated creditors to assist and monitor the administrators.
It is understood the composition of a COI has been formalised, with creditors to be informed within the next day.
According to minutes of the first creditors’ meeting on 17 March posted on Friday by ASIC, these creditors include the Australian Tax Office, which is claiming $6,051,760, although the number listed in its wind-up action against the school was $8 million, and NAB for $9,282,220.
Controversial former board chair Greg Zwajgenberg is owed $205,000 and could have conceivably been voted on to the COI, despite concerns about conflict of interest. The administrators told the meeting that as a secured creditor he had a right to be considered.
Life Unlimited Church is owed $241,089 as one of five trade creditors, including Guardian Business Consulting ($52,800) and Canberra Discount Chemicals trading as The Cleaning Warehouse ($23,208).
Two former employees are claiming $21,333 and $12,741, and there are eight parents saying they are owed amounts ranging from $8000 to $23,000.
In the meeting’s Q and A, the Tax Office was told that the college was being marketed to relevant schools and stakeholders across Australia to gauge interest in acquiring it as a whole.
Chair and administrator Sam Marsden said the aim was to continue operating the school as usual to maximise its value and allow another school or party to acquire it as an operational institution.
This was best achieved by maintaining the school’s integrity, ensuring ongoing trading, encouraging parental support, and retaining teachers, he said.
The process could proceed either through a sale of business and assets or via a deed of company arrangement, whereby the ownership interests could be transferred to a new owner.
Some agents had been shortlisted to conduct valuations for the property, as well as the business and assets of the school.
It is understood that the EOI process is progressing well, and the administrators have talked with a number of interested parties.
Asked about whether the Charnwood campus could be sold separately, Mr Marsden said the college was advertised for sale as a whole, but the ongoing operations of the school were being reviewed to ensure financial viability.
Mr Marsden also told the meeting that the college advertising on buses and light rail would cease.
Creditors at the second meeting will face three options for the future of the college: entering into a deed of company arrangement if one was put forward, ending the administration with control returned to the directors or placing the college into liquidation.
