Hellaby snares 25% of outstanding debt from BBQ Factory deal

Investment company Hellaby Holdings will only get back a quarter of the amount still outstanding from its disastrous investment in the BBQ Factory.

The company is still owed $4.44 million from the $5.8 million outstanding from the June 2008 sale and announced today it only expects to recover about 25% of the outstanding debt over the next three months.

Hellaby managing director John Williamson said the investment company had now reached a settlement with the consortium that bought BBQ Factory in June 2008.

“Having reviewed the costs and benefits of the various recovery options we believe that this settlement is, on balance, the best value recovery for Hellaby shareholders.”

Hellaby sold BBQ Factory to the consortium for a deferred consideration of $5.8 million, but received just $1.35 million.

The Hellaby board fully provided against the outstanding $4.44 million in June, citing “ongoing uncertainty” over the debt.

At its recent annual meeting, the company admitted the BBQ Factory investment had been “disastrous” and had handicapped the company’s response to the current economic climate.

Chief executive John Williamson said at the meeting it was disappointing to note that the company’s NPAT guidance would have been exceeded if it had not been for the impairment.

The listed investment company saw its net profit after tax for 2009 fall from $4.7 million to $707,000.

However, Mr Williamson said the impairment was a prudent approach that would allow the company to “close a disastrous legacy chapter for Hellaby.”