The administrators of Penrice Soda Holdings will axe 11 positions at the company’s Osborne plant as they look to sell the company.
Administrator McGrathNicol says it has received interest from local and international parties after the process to sell the local chemicals manufacturing business began in April.
“Given the level of interest we’re optimistic about the sale process, and the work underway to ensure Penrice is presented in as strong an operating position as possible is ongoing,” McGrathNicol Partner Sam Davies said.
Administrators have completed a review which showed 11 surplus staff at the Osborne plant.
Penrice was placed into voluntary administration on April 11.
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The company will continue to trade normally ahead of a second creditors’ meeting on July 31.
The second creditors’ meeting will determine the outcome of the administration of the Penrice group.
In March, Penrice posted a second consecutive $28 million first half loss, driven down by writedowns on its Adelaide soda ash plant.
The company faces debts of around $200 million and hasn’t made a profit for years.
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It owns an ageing processing plant at Osborne, one of the oldest chemicals manufacturing sites in the state, on the edge of the Port River.
Penrice’s only valuable asset is a limestone quarry at Angaston.
Penrice has been manufacturing chemicals at the Osborne site since the mid-1930s, originally under the name of its first owner ICI.
It was carved off and re-badged as Penrice in 2008. Penrice owes its banks (NAB and Westpac) $111 million.
There are other private financiers owed millions on top of that.
Unsecured creditors are owed $14 million.
Employee entitlements for Penrice’s 180 workers total $4.5 million.
Transport companies, utilities and others are owed money.
Scott’s Transport Industries says it is owed $1.43 million, energy distributor Envestra put in a claim for $56,100 and Momentum Energy for $648,000.
Ridley Corporation, which owns the salt pans that had been an essential component of soda ash manufacturing before Penrice closed down that part of its business, says its losses from frustrated contracts will amount to more than $27 million.
