Australia’s Murray River Organics has called in administrators, suggesting it failed to attract “expressions of interest” under strategic options put forward last year.

KPMG has been appointed as receivers and managers for Murray River Organics, while Grant Thornton is “joint and several voluntary administrators of each company in the group”, according to separate notices from the global accounting firms filed with the Australian Securities Exchange today (9 February).

“Notice is hereby given that on 9 February 2022 the directors of the companies resolved that the companies are likely to become insolvent at some future time and that administrators should be appointed to the companies,” Grant Thornton’s statement read.

Loss-making Murray River Organics announced in December it was reviewing strategic options for the business through Lion Advisory, including seeking “expressions of interest” with a view to the full sale of the company or a partial interest.

The owner of the Premium Australian Clusters snacks brand said then its securities would remain suspended on the stock exchange after a “change to the profit and loss and financial position reported in the appendix 4E preliminary final (annual) report lodged was identified”.

Recently installed CEO Birol Akdogan had endeavoured to move Murray River Organics away from its farming operations to focus on its branded, value-added retail products – fruit and nut snacks, cereals and cooking oils – sold into stores such as Woolworths and IGA.

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By GlobalData

After disposing of dried vine fruit assets in New South Wales last May and selling land to Costa Group Holdings in 2020, Murray River Organics announced in December a full-scale exit from its farming operations.

In its full-year fiscal 2021 results issued in August, Murray River Organics confirm it had sold part of its fresh fruit farm in Nangiloc, Victoria, and also its Fifth Street and Gol Gol “properties”.

For the year ended on 30 June, Murray River Organics reported a 12% decline in group sales to AUD42.6m (US$30.5m). Branded retail made up AUD24.5m, an increase of 24%, ingredients AUD11.9m, exports AUD6.9m and fresh produce AUD1.4m.

EBIT-L came in at a AUD19.6m loss versus a AUD36.3m loss a year earlier.

Underlying EBITDA-SL was also in the red at AUD11.7m, compared to a AUD10.3m loss in the corresponding period.

KPMG noted in its filing: “The receivers and managers are conducting an urgent assessment of the group’s financial position as operations continue as usual. The receivers and managers will commence a process to market the group and its assets for sale in the coming weeks.”

Grant Thornton added: “The appointment of the voluntary administrators followed the recent review of the companies’ strategy and operations that highlighted the need for further capital to continue the companies’ transformation.

“This followed an extensive process that included various attempts by the companies to preserve and or realise value for all stakeholders through a recapitalisation of the companies, asset realisations and/or corporate transactions and following ongoing discussions with the companies’ secured creditor and other key stakeholders.”