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Australian wine giant goes under [Updated]

Australian wine group Palandri has called in the administrators, it was announced today.

The Western Australian wine group said that it had appointed accounting firm Deloitte to oversee its ‘complex’ finances. The accounting firm issued a statement saying it would continue the group’s wine business, including that of producing the 2008 vintage, due to begin next week.

David Hodgson, Palandri Europe general manager told decanter.com that the problems stem from the group’s financial arm and that the wine business has been ‘trading well’. He added that Deloitte’s wine specialists had joined the administrators on Thursday.

‘The voluntary administrators are in discussions with the secured creditors of the Group and believe that maximising the return to all stakeholders very much depends on continuing the core wine business as a going concern,’ said Deloitte.

Potential suitors for Palandri have yet to emerge but the administrators look set to sell the wine business to another operator unless new investors can be found.

Hodgson said Palandri was optimistic and had ‘a number of potential investors’. He did not reveal their identities. The company’s chief executive Darrel Jarvis is understood to have been in London talking to European investors this week.

Deloitte was called in earlier this month when Palandri’s financial arm collapsed under heavy debts. The rest of the group was forced to follow suit after attempts to raise additional financing failed. According to Hodgson, the problems largely stem from the Queensland government’s decision to ‘pull the funds invested.’

The group entities now in voluntary administration are Palandri, Palandri Wine Production, Palandri Wines, Margaret River Wine Investments and Palandri Management.

In 2006 Palandri said that it was looking to list on the Australian stock exchange but the plan never materialised.

Palandri markets its Solora, Pinnacle, Boundary Range, Estate and Reserve wines in the UK. It is also present in various other European markets and the US.

The European and US units are not in administration.

Written by Jo Iivonen

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