Bestjet mystery deepens
CONTROVERSY continues to swirl around the collapsed Bestjet Travel Pty Ltd (TD 18 Dec 2018), with the company’s administrators citing “evidence that 50% of the shares were held on trust for Ms Rachel James”.
That’s despite the widely announced 100% sale of the business less than six weeks before its collapse to McVicker International (TD 06 Nov 2018) and claims by James that her family had “relinquished control” following a two-month period of audit and business advice provided by accounting firm BDO prior to the Nov handover.
Minutes of the fiery first meeting of creditors (TD 03 Jan) which have now been released by ASIC also state preliminary estimates of more than $14 million in unsecured creditors, including $7.28 million owed to 2,300 people by Bestjet Travel Pty Ltd and $7.06 million owed by subsidiary Wynyard Travel Pty Ltd.
The administrators from Brisbane accounting firm Pilot Partners said debtors claimed by the company’s director, Robert McVicker, include $3.2 million owed by Sabre Asia Pacific Pte Ltd - but these funds are subject to an agreement with a Singaporebased company also named Bestjet Travel Pte Ltd.
This Singapore entity is still in operation, and Rachel James is a director of the company alongside Singapore citizens Nancy Tan and Unikrishnan Sugandhi.
Interestingly, all of the shares in Singapore-based Bestjet Travel Pte Ltd are held by yet another Australian company called Bestjet Travel Holdings Pty Ltd.
Rachel James is the sole director and 100% shareholder of this company, which has not been placed into administration.
The Bestjet Travel Pty Ltd administrators said they had terminated any agency agreement existing between Sabre and the Singaporean Bestjet and demanded the rebates be paid directly to them on behalf of the collapsed firm.
They cited several reasons for the collapse, including the nonreceipt of the Sabre rebate, the cash-flow impact of consolidator CVFR seeking daily, rather than weekly payments, and the loss of about $4 million in turnover due to Skyscanner removing Bestjet from its search results for a two day period.
Pilot Partners said their investigations were continuing, particularly noting probes into rebates owing, the company’s call centre and “related party transactions”.
They noted that the company had a “high volume of transactions with a low profit margin” and said that in the absence of any proposed Deed of Company Arrangement they expect they are likely to recommend the liquidation of the business.
A further report will be issued to creditors later this month.