Nant founder un­der fire

Liq­uida­tors claim ev­i­dence of in­sol­vent trad­ing

Sunday Tasmanian - - News -

DI­REC­TORS of a failed Tas­ma­nian whisky com­pany may have traded in­sol­vent, breached their du­ties and com­mit­ted other of­fences, liq­uida­tors say.

Nant Dis­tillery at Both­well, later named Naw Dis­tillery, col­lapsed ow­ing an es­ti­mated $4.9 mil­lion to cred­i­tors.

It was the brain­child of Queens­land bank­rupt Keith Batt and one of sev­eral busi­nesses that formed his Nant group of com­pa­nies.

The dis­tillery is now run by Aus­tralian Whisky Hold­ings (AWH), which is com­pletely sep­a­rate from Nant, but con­tin­ues to use the brand name.

In a star­tling re­port liq­uida­tor Deloitte said it found ev­i­dence sug­gest­ing the for­mer dis­tillery com­pany had been trad­ing in­sol­vent for years.

“In­ves­ti­ga­tions re­gard­ing the com­pany’s af­fairs re­vealed [it] may have been in­sol­vent from as early as 30 June 2014,” Deloitte’s Richard Hughes said.

“Our in­ves­ti­ga­tions in­di­cate that the Di­rec­tor [Mar­garet Batt nee Le­tizia] and For­mer Di­rec­tor [Keith Batt] may have con­tra­vened cer­tain pro­vi­sions of the Act and com­mit­ted of­fences which in­clude but are not lim­ited to in­sol­vent trad­ing, breaches of di­rec­tors du­ties.

“Not­with­stand­ing, the Di­rec­tor and For­mer Di­rec­tor may have de­fences.”

Mr Hughes also said fur­ther in­ves­ti­ga­tions were needed to draw “de­fin­i­tive con­clu­sions” and ul­ti­mately “in­sol­vency would need to be de­ter­mined ... [by] a court”

At­tempts to con­tact the Batts were un­suc­cess­ful.

Nant has come un­der sus­tained scru­tiny for its whisky bar­rel in­vest­ment scheme, which left in­vestors out of pocket.

In­vestors forked out thou­sands of dol­lars for the bar­rels but an AWH au­dit this year al­leged hun­dreds of bar­rels were never filled.

The liq­uida­tor’s re­port re­veals Nant Bar­rel Hold­ings, which man­aged the in­vest­ment scheme, trans­ferred at least $4.9 mil­lion in funds to Nant Dis­tillery. It was never paid back, with Nant Bar­rel Hold­ings listed as a re­lat­ed­party cred­i­tor to the dis­tillery busi­ness.

The in­vest­ment scheme is now un­der in­ves­ti­ga­tion for fraud by Tas­ma­nia Po­lice’s se- ri­ous and unit.

The re­port found Nant re­lated par­ties also owed the dis­tillery com­pany more than $4 mil­lion. This in­cludes $1.15 mil­lion owed by Mr Batt and more than $250,000 owed by Mrs Batt.

The liq­uida­tor’s re­port high­lighted pos­si­ble “un­com­mer­cial transactions” and “un­rea­son­able di­rec­tor re­lated transactions” as po­ten­tial tar­gets for re­cov­ery ac­tions.

The re­port stated there were lots of “unan­swered ques­tions, due to the lack of records” re­lat­ing to the com­pany’s demise but pointed to year on year losses and the reg­u­lar trans­fer of funds be­tween re­lated Nant en­ti­ties.

The liq­uida­tor ex­pressed frus­tra­tion at “the re­sis­tance and non­co­op­er­a­tion of some par­ties” which meant in­vesti- gations were “only pre­lim­i­nary and lim­ited”.

For in­stance Mr Hughes had not re­ceived doc­u­ments at the time of the re­port from AWH, which bought the dis­tillery’s as­sets. He said there were sev­eral par­ties in­volved in op­er­at­ing Nant Dis­tillery and its sale be­fore liq­uida­tors were ap­pointed.

“We have not re­ceived clear answers to our queries nor have we re­ceived any agree­ments or con­tracts per­tain­ing to same,” he said.

“This in­for­ma­tion is a crit­i­cal part of in­ves­ti­ga­tions and we in­tend to con­tinue to make in­quiries to as­cer­tain the role each party played and whether or not they con­trib­uted to the demise of the com­pany.”

Deloitte will seek fund­ing, pos­si­bly from a lit­i­ga­tion fun­der, to have var­i­ous par­ties ex­am­ined in court.

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