THE directors of Feature Tours have been negotiating with the Australian Tax Office over a $538,791 debt, which stands as the major obstacle to a Deed of Company Arrangement with creditors.
Feature Tours CEO Manny Papadoulis, who has been deemed a de facto director by the company’s administrator Cliff Rocke of PPB, said that he hoped a resolution could be reached with the tax department, which had already started legal action to recover its debts – mainly related to GST.
“Once that is done, it will be clearer what we can or can’t do,” Mr Papadoulis said.
Creditors agreed last week to allow a 60-day breathing space for the company’s representatives to find a way of including the ATO in the proposed DOCA.
Feature Tours went into voluntary administration last month and creditors have been told the company has a net debt of almost $3.4 million.
About $2.2 million of that is owed to the Papadoulis family or their interests. Trade creditors amount to just over $500,000 and come from all parts of the tourism-related service industry.
In a report to creditors obtained by WA Business News, Mr Rocke suggests Feature Tours may have been insolvent for almost 16 months prior to his appointment. However, he suggests a claim against the directors would be likely to return only 1 cent in the dollar at best if creditors chose to pursue this course.
Mr Papadoulis denies insolvent trading. He expects the company to return to previous trading levels and, since the administrators’ appointment three weeks ago, it has made a $15,000 profit.
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