Chas Kelly tips a bright future ahead for rebranded Noske Logistics

By: Brad Gardner


Company has a strong workforce, good equipment and contracts, new owner says.

Chas Kelly tips a bright future ahead for rebranded Noske Logistics
Man with a plan: Chas Kelly has got to work reviving Noske Logistics under a new name and he says "the future is good" for the company.

 

The man who took over Noske Logistics is tipping a bright future for the once troubled firm, and the company’s former owner is staying on to help run it.

Chas Kelly, who purchased the  assets of the financially stricken Noske group of companies after they went into administration, has told Owner//Driver "the future is good" for the business.

He says the company will continue providing woodchip and tipper transport services — albeit under a different name and with Tony Noske on board.

"We’re rebranding it to Kelly Logistics so it becomes part of our enterprise," Kelly says.

"Tony will be staying on to help us run it. There is a huge amount of experience and knowledge there that is best for us to keep.

"I’ve known Tony for a lot of years and I’ve been aware of his business, of course, and I saw it as another opportunity for our company to expand. It’s a good workforce and their equipment is exceptionally good so I decided I would give it a run."

The Noske group was made up of Noske Logistics, Noske Forestry Logistics and Whitleigh. Noske Logistics transported cement and fertiliser from Geelong and logs to Geelong, while the forestry arm harvested logs and transported woodchips to Portland. Whitleigh provided back-office support services to the two divisions.

Kelly says he will continue running the Noske group’s Portland and Geelong depots, but a lot of administrative support services have been shifted to Kelly’s home base of Tasmania, while the head office has moved to the Melbourne suburb of Sunshine.

"We’ve been able to restructure and recapitalise it and we’ve shifted some of the back office stuff to our head office in Tasmania. It will auger well for the future," Kelly says.

"The contracts are good, the people are good, gear’s good, so we’re into it and we’re looking forward to it."

The three arms of the Noske group of companies went into voluntary administration in September.

Kelly came to the rescue within days with a buyout offer that included a commitment to take on significant financial liabilities and retain the majority of employees.

A report from administrator PPB Advisory says Kelly offered $735,044 for the assets of the companies, with the figure covering plant and equipment, goodwill, spare parts and office equipment.

Kelly also took on about $362,000 in employee liabilities such as leave and sick pay, established a $250,000 deed fund that will secure most of employees’ superannuation entitlements and agreed to purchase a $3.5 million debt the company owed to Bendigo Bank.

PPB Advisory is responsible for administering money from the deed fund.

"They [employees] will get somewhere between 77.4 cents and 81 cents in the dollar of their super because of the amount of money we paid. That is an excellent outcome for the employees of a company that needed revitalising," Kelly says.

Kelly says the employees would have likely lost all their outstanding superannuation entitlements without the deed fund.

A spokesman for PPB Advisory says the full amount of the deed fund has not yet been distributed.

"There should be sufficient monies in the deed fund to cover the majority, if not all, of the outstanding superannuation," the spokesman says.

 

 

The man who took over Noske Logistics is tipping a bright future for the once troubled firm.

Posted by Owner Driver on Wednesday, 11 November 2015

 

QUBE PORTS SHOWED INTEREST IN NOSKE LOGISTICS

Kelly was not the only one to show interest in the Noske group of companies, with PPB Advisory saying it received an unsolicited enquiry from Qube Ports.

However, the company walked away when told on September 8 it had to act fast if it wished to make an offer.

"Later that afternoon we received an email from Qube Ports advising us that it had decided not to proceed with any offer in relation to the assets," PPB Advisory says.

The following day PPB Advisory’s lawyers recommended the sale to Kelly was in the best interest of creditors.

The enquiry from Qube Ports was not the first time it had expressed interest in the Noske group.

Tony Noske told PPB Advisory it sent a letter of interest to him on April 14 this year and sent terms of sale to him on June 11.

He says it valued the company’s assets at $47 million. Settlement was due to happen on August 28 but Qube Ports withdrew from the process on August 11.

 

NUMBER OF FACTORS BROUGHT NOSKE FIRMS UNDONE

PPB Advisory’s report details a bleak few years leading up to Noske Logistics and its other entities entering administration, including uncompetitive financing arrangements, problems with work contracts and a significant debt to the Bendigo Bank.

"Our preliminary view is that the Group may have traded while insolvent from as early as June 2013," the report states.

"We have not conclusively identified any contraventions by the Directors or others (excluding possible insolvent trading).

"The debt owed to Bendigo originated as a residential property loan made to Tony Noske (originally guaranteed by Noske Logistics and Noske Forestry Logistics)."

PPB Advisory says the three groups owed creditors a total of $16.9 million when administrators were appointed and owed $7.7 million to unsecured creditors.

Noske Logistics alone owed the Australian Tax Office (ATO) $2.7 million. The Forestry division owed the ATO $308,130, while Whitleigh had a $479,985 tax debt.

"The Group lacked working capital from FY13 and trading losses have largely been funded from increasing statutory liabilities and personal loans," the report says.

The company did enter into repayment plans with the ATO, but PPB Advisory says it defaulted on them.

"Consequently, a formal demand from the ATO was received in January 2015 and winding up proceedings commenced in May 2015," the report says.

In his explanation to PPB Advisory on where his businesses went wrong, Tony Noske cited the purchase of the transport company Whitpark — which supplied services to Noske Logistics — and problems with a haulage contract.

He told PPB Advisory that Noske Wind Energy Logistics going into liquidation in October 2012 led to Whitpark entering administration due to a large intercompany debt.

Noske Logistics and Forestry Logistics purchased the business and paid $1.3 million in liabilities between December 2012 and December 2013 as part of the deal.

It then took on a five-year harvest and log haulage deal with company Midway in April 2014, but problems meeting volume projections and the delayed delivery of equipment led to the Noske group incurring losses for nine months from June 2014 to March the following year.

 

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