A lack of recent hailstorms is just one of the reasons why a national panel beating group has collapsed owing almost $5million to creditors.
Seven companies operated by Action Smart Group are in liquidation with debts of at least $4.7million, including an eye-watering tax bill.
The nationwide panel beating group blamed a lack of major hailstorms in recent years and the business growing too fast, too soon for the demise of its workshops in New South Wales, ACT, Victoria, and South Australia.
Dozens of small paint and panel beating businesses across Australia have also lost thousands in the liquidations and are unlikely to be repaid.
The companies, directed by Gold Coast‘s Adam Blackwell, went into voluntary liquidation on April 2, and hired liquidator Steven Naidenov of Aston Chace.
Documents lodged by Mr Naidenov, with corporate regulator ASIC, revealed the companies owed at least $4.7million.
Action Smart Group had authorised repairer deals with insurance companies including NRMA and sent hail damage work to small contractors across Australia.
Action Smart Group’s website stated it was an Australian owned and managed company that ‘has established a reputation among insurers and competitors as the market leading hail repair specialists’.
Action Smart Group director Adam Blackwell is pictured
A lack of hailstorms was one reason as to why Action Smart Group (pictured) collapsed
Mr Naidenov said early investigations showed the group may have expanded too quickly, had borrowed $2million and amassed tax debts of around $4million.
‘As a small business, losing any money is really hard in this day and age,’ one business owner told the Courier Mail.
‘It means we’ll have to source income from other areas.’
Action Smart businesses have continued operating as new entities despite their collapses after new businesses overseen by Mr Blackwell bought them a few months before the liquidations.
Mr Blackwell said in a statement the decision to liquidate was made to make sure all legal and ethical obligations to employees were met ‘and to ensure the best outcome for creditors, customers, and suppliers’.
‘This outcome also reflects the highly seasonal nature of the hail repair industry, with reduced storm activity over the past three years placing sustained pressure on the business and contributing to this difficult decision,’ Mr Blackwell said.
‘All employee entitlements, including wages and superannuation, have been prioritised, and creditors have been engaged through the formal liquidation process.’
Mr Naidenov revealed three of the collapsed companies sold their businesses to new companies directed by Mr Blackwell for $6.78million in September.
Director Adam Blackwell (pictured) said the decision to liquidate was made to ensure the best outcome for creditors, customers and suppliers
‘My investigations into the commerciality of the above sales and other aspects of the liquidations such as other voidable transactions are ongoing,’ he said.
‘In the event that the sales are uncommercial or undervalue then action will be commenced against the purchasing entities and the parties associated with the sale to remedy such claim.
‘I have yet to form a view regarding the appropriateness of the pre-appointment business sales.’
Daily Mail Australia has contacted Action Smart Group for comment.
