Conference and comms firm loses footing
An Australian publisher and conference provider with ties to the local government sector has entered voluntary administration.
CommStrat – which ran a range of local government news outlets - had been operating for over 53 years, and blames its collapse into voluntary administration largely on structural change.
“In the last 12 months, CommStrat’s operations have been negatively affected by sharp reductions in discretionary spend in key customers segments, particularly local government, and structural change in CommStrat’s online job advertising business,” CommStrat chairman Alexander McNab said in a recent statement.
“These challenges have been compounded by CommStrat’s obligations under its senior debt facility.”
Deloitte administrators have been called in, with Richard Hughes and Glen Kanevsky appointed to run the administration of CommStrat and its subsidiary Hallmark Editions.
The administrators say the company continues to trade and retain all 25 of its employees.
They are assessing CommStrat’s financial position with a view to getting the most value for all stakeholders in the event of a sale.
CommStrat’s annual report last year said its primary lender - National Australia Bank - was “supportive of the business strategy” and extended a loan agreement until March this year.
Chairman Alexander McNab said CommStrat had sought “accommodation from its senior lender and other creditors” in recent days, after it was slugged by “weaker than expected trading” in December 2014 and January 2015.
“The directors are now of the opinion that CommStrat will not receive sufficient accommodation to continue trading as a going concern,” he said.
The Deloitte administrators are now sifting through the pieces of the broad business network, figuring out what to do with its media and IP assets.
It is understood that parts of the CommStrat network will be shopped-around to existing industry players.