confusion surrounding octaviar debts

Confusion surrounding Octaviar debts
Friday, May 30, 2008


There’s a degree of confusion surrounding the Octaviar debts being called in, with NAB’s deadline for its $40 million passed and gone without action, it is unclear where creditors are standing in relation to the old MFS company.

Close of business on Wednesday was the end of the 21 day deadline that the National Australia Bank had imposed on Octaviar to pay back its debt, but having passed that mark, there has since been no action taken.

It is understood that Octaviar has some $170 million in cash – so it could very well pay back the NAB debt; but analysts predict that Octaviar is holding back in consideration to which debt it should pay back first.

And now Octaviar has spoken up declaring that the debt isn’t theirs, but Living and Leisure Australia’s onus. Living and Leisure Australia is also a former MFS company, and traded under the MFS Living and Leisure brand.

Living and Leisure has hit back saying the debt is Octaviar’s as they had provided the guarantee for the money.

As the shifting of the blame continues, this $40 million is the least of Octaviar’s worries, as the court date for Challenger Group’s claim of $100 million is set for July the 21st at the NSW Supreme Court.

And even before this showdown occurs, Octaviar will next week have to face the Public Trustee of Queensland’s deadline of 5th of April for another $351 million in debts.

As this all takes place, Octaviar is becoming uncertain if it can complete and finalise the sell off of a 65% stake in its Stella business to CVC Asia Pacific before all debts are called in.

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