Creditors in for long wait

CREDITORS for the parent company of collapsed discount store chain Chickenfeed are waiting to retrieve tens of millions of dollars, as lengthy proceedings to recover the funds are still in the early stages.

Retail Adventures, owned by Tasmanian businesswoman Jan Cameron,  was Australia's largest discount variety store operator but went into liquidation in February.

Liquidators are now pursuing more than $100 million from Ms Cameron for insolvent trading, preferential payments and an invalid loan.

Deloitte liquidator Vaughn Strawbridge told a meeting of creditors last month that discussions were underway with litigation funding organisation Bentham IMF to hold public examinations later this year.

 If funded, Ms Cameron will be called by the liquidators to face a formal open-court process.

Mr Strawbridge told creditors at a meeting that they will have to wait ``significant time'' to make recoveries.

``We want to commence the action as quickly as possible,'' he said.

Mr Strawbridge said action against Ms Cameron's companies DSG Holdings Australia and Bicheno Investments for voidable transactions had already begun. 

Ms Cameron used the companies to buy back the failed discount retailer last year, and Mr Strawbridge said more than $77 million had been lent to Retail Adventures by the companies and up to $50 million was invalid because the loan was secured when Retail Adventures was insolvent in 2011.

Bentham IMF were used last year to fund court proceedings that over-turned a deed of company arrangement Ms Cameron proposed which would have seen creditors be returned only 6 cents in the dollar.

But the Federal Court ordered the company be wound up, finding liquidation would have a much higher return for creditors.

Retail Adventures ran about 30 Chickenfeed stores in Tasmania, as well as Crazy Clarke's, Sam's Warehouse and Go-Lo on the mainland, but went into voluntary administration in October 2012.

DSG ran the Chickenfeed stores under licence, and the last of the house-hold name stores closed up shop last year.


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