Quickflix creditors swap administrators

Creditors of movie streaming service Quickflix changed administrators to Deloitte, just two weeks after the company voluntarily appointed partners from Ferrier Hodgson.

Ferrier Hodgson representatives Dermott McVeigh, Wayne Rushton and Morgan Kelly had been appointed to the role when the voluntary administration was announced on April 26.

At the first creditor’s meeting on Friday, however, a resolution was passed to appoint Richard Hughes and Jason Tracy in their place.

It is understood one of the Ferrier administrators had previously worked with Quickflix, which had been disclosed in the statement of independence.

Ferrier opted to hand over early in the piece rather than have a potential deal fall through, and Business News understands it was an amicable changeover.

Mr Tracy, who is a restructuring services partner at Deloitte, said that he and Mr Hughes were currently examining Quickflix’s trading position and would look to assess if a going concern or recapitalisation could be achieved.

"We will work with the previous voluntary administrators to ensure a smooth transition," Mr Tracy said.

"It remains a case of business as usual, with no impacts on customers or employees for the time being.

"Expressions of interest regarding the sale of all or parts of the business have previously been advertised and we will continue this process and also look at potential restructure and recapitalisation options."

Blocking stake

Quickflix was an early mover in the video streaming market, however the company came under pressure from large competitors such as Netflix.

Chief executive Stephen Langsford said the company had struggled to raise capital because of a $11.7 million redeemable preference share stake held by the owners of Stan Entertainment, Nine Entertainment and Fairfax Media

Such shares rank above ordinary equity for dividends and capital returns while counting as debt on the company’s balance sheet.

That created a disincentive for new investment, Mr Langford said.

The company attempted a restructure in April, which included a cut to the salary of Mr Langsford by 30 per cent to $200,000.

Other changes included reducing staff numbers, consolidating operations and closing offices.