RURAL finance company, Bidgee Finance, has been placed in the hands of receivers.
The move by the trustee of the Mildura-based company’s debenture notes follows Bidgee’s decision earlier than month to suspend redemptions in the wake of the Federal Government’s decision to limit the financial institutions whose deposits would be guaranteed.
Bidgee debenture holders are owed $18 million.
Mark Korda and Craig Shepard of KordaMentha have been appointed as receivers and managers.
Bidgee managing director, Martin Hill, said he would work with Mr Korda to collect the company’s loan book.
“It could take several years to begin to repay the debenture holders and meanwhile steps would have to be taken to align Bidgee’s operations with current market realities,” Bidgee said in a statement.
“Bidgee’s offices will remain open while the company’s business strategy is assessed.”
Nationals MP John Forrest said he was dismayed to learn receivers and managers had been appointed to Bidgee.
"From all I hear, this was a company in good shape prior to the bank guarantee, despite earnings being down a little due to the drought and adverse interest rate movements," Mr Forrest said.
He said the deposit guarantee had given the banks a "huge free kick at enormous expense to non-bank financial institutions across Australia."
"Bidgee might just be one casualty of many," Mr Forrest said.
Bidgee Finance was established at Hay, NSW, in 1961 and listed on the National Stock Exchange in May 2005.
Earlier this year the company reported a before-tax profit of $2.6 million in 2007-08.
From tomorrow, debenture holders and shareholders can call the toll free number on 1300 243 433 or access the KordaMentha website at www.kordamentha.com for further information.
