The company also had $326,600 in accounts payable that liquidators classed as “probable claims”.
The only assets liquidators said were available to them were $8000 in a company bank account and $106,370 due from the sale of the business to Weyland Group.
The business of Wild Poppies – an online florist operating since 1998 – had been sold the same day Waterstone was appointed on May 19.
Weyland was only incorporated the week prior, with Cole Bradburn, Kerry’s son, listed as sole director and shareholder.
Creditors expressed outrage at the chain of events that saw the company’s assets and business sold off just before liquidators were appointed, leaving creditors staring at a hole of more than a million dollars.
Botterill said he had no insight into Kerry Bradburn’s intentions or state of mind when conducting the sale-and-liquidation, but the company had been backed into a corner by insolvency.
“I think she was desperate. She had very few options. She was facing court-appointed liquidators or this,” he said.
Kerry Bradburn, owner of Wild Poppies before its collapse into liquidation last month.
Creditors also expressed surprise at the sale price, arguing it was too low.
One said the sale price was a fraction of what seemed reasonable, given the company’s profit-and-loss accounts showed annual revenues of nearly $6m and quarterly net profits of $125,000.
Liquidators revealed the business sale was also no-money-down and they had yet to receive any proceeds, with payment said to occur over the next 12 months providing certain targets were met.
“How are they able to continue to trade without making a payment?” one creditor asked.
Last month, Bradburn acknowledged her son had taken over the business.
“Obviously, he’s related to me, but the business has been valued, it’s all above board. He’s paid the market price for the business. We wouldn’t be stupid enough to not,” she said when contacted for comment on the liquidation.
“There’s nothing untoward that’s happened,“ Bradburn said. “It’s all legitimate, there’s no problems.”
Botterill said reversing the sale would likely need court action, which was expensive to mount and possibly damaging to the business.
“Not only would it be expensive, it would be defended. Given the size of the business, it would also be uneconomic,” Grant said.
Botterill said, despite the sale being independently valued prior to the transaction, he was negotiating with Weyland to uplift the price paid.
“We’re asking for about $70,000 more,” he said.
The liquidators acknowledged that even if that additional sum were obtained from Weyland it would see every creditor in the room – all of whom were unsecured – receive nothing given the secured and preferential debts ranking above them.
“IRD are owed around $400,000 – they’re likely to be the only winners here,” Grant said.
Creditors raised concerns that Weyland was operating as a phoenix company, but Grant said the new entity had different directors and shareholders and those Companies Act provisions did not come into play.
Bradburn told the Herald she had no involvement – as either an employee or manager – with Weyland and defended her actions.
“No one goes into business to go broke. This is a horrible situation I wouldn’t wish on anyone,” she said.
Questions to Cole Bradburn and Weyland by the Herald did not receive a response.
Grant said there was the possibility of referring the matter to the Registrar of Companies if Bradburn was found to be acting as a director in the new company, but warned creditors even that might not get the outcome they sought.
“Her behaviour here, and I know you all think it’s appalling, but we have seen worse,” Grant said.
Botterill said while his administration was focused on the remnants of Wild Poppies, other action was possible with regard to Bradburn.
“She’s not off scot-free. She has a raft of personal guarantees that creditors can elect to pursue,” he said.
The meeting closed with the election of a creditors’ committee.
Matt Nippert is an Auckland-based investigations reporter covering white-collar and transnational crimes and the intersection of politics and business. He has won more than a dozen awards for his journalism – including twice being named Reporter of the Year – and joined the Herald in 2014 after having spent the decade prior reporting for business newspapers and national magazines.
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