Second-gen CEO’s $19m disaster as staff axed, family-run printing empire Starleaton goes bust
A second generation family-run national business founded nearly 50 years ago will be liquidated after it collapsed under $19m debt, with administrators scathing of the son-turned-director.
Business
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A second generation family-run printing supplier will be liquidated, after collapsing under debts estimated to run up to $19.5 million.
Starleaton was a supplier of ink, paper stock and equipment to signage printers across Australia and New Zealand.
Since starting in Sydney in 1978, it had expanded to eight locations including Melbourne, Brisbane, Perth and Auckland, with about 50 staff.
It claimed to be Australia and New Zealand’s largest family-run supplier to the sign and display sectors, with more than 5,000 customers.
But in January last year, it went into voluntary administration, with estimated debts of up to $19.5 million, according to documents lodged with ASIC.
The largest debt of $5.4 million was owed to founders Peter and Leanne Eaton, parents of company director and CEO Ben Eaton.
Creditors had agreed to a Deed of Company Arrangement (DOCA), where they would share from a pooled fund of $800,000 which Ben Eaton would pay over two years.
This entailed monthly payments of $33,333.33.
The administrators’ firm Cathro & Partners told News Corp Starleaton entered liquidation on Wednesday afternoon, due to an issue with the DOCA.
Under the deed, employees were promised they would receive all of the estimated $1.3 million they were owed, while other unsecured creditors were expected to receive 1 cent per dollar.
Starleaton had continued to trade in a limited capacity during its administration, as the administrators had aimed to sell the business.
It had reduced staff from 28 to six employees and cut its sites down to just one in St Leonards, Sydney.
In a report lodged with ASIC last year, administrators Andrew Blundell and Simon Cathro said the company had failed as its performance and cash flow deteriorated, while it had poor strategic management and its funds were tied up in inventory.
They also noted Starleaton and SDS Bidco were likely insolvent from mid-2023 and potentially as far back as April 2021.
There were transactions and intercompany dealings which would be further investigated if the company was liquidated, the report said.
After Starleaton entered administration, director and CEO Ben Eaton took to the company’s website to write a “public apology” to staff, customers and supply partners.
“I especially want to apologise to all the staff,” he wrote.
“It was a horrible situation they found themselves in, with many of them having to be stood down on day one.”
“The financial health of the business is ultimately my responsibility.”
He wrote there were a number of factors leading to the company’s failure, including inflation and a drop in spending from its customer base.
“Whilst we had started a restructure of the business at the start of the [2024 financial year], the impact of these changes was not impactful enough and the overall financial stability of the company continued to come under pressure.”
News Corp contacted Mr Eaton, but he declined to comment.
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