George Calombaris’ food empire could go into liquidation
Late-night souvlaki destination Stalactites has saved two of George Calombaris’ restaurants from permanent closure, but the outlook doesn’t look as good for the rest of his crumbling food empire.
VIC News
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The owners of late night souvlaki destination Stalactites have been revealed as the savior of two of George Calombaris’ Jimmy Grants restaurants.
Sources confirmed the owners are the prospective owners of the duo of Jimmy Grants stores – pending landlord approval.
The Jimmy Grants Emporium site and the original shop in Fitzroy are the stores likely to be sold to the owners of Lonsdale Street’s Stalactites and Elizabeth Street’s Hella Good.
It is reported the Jimmy Grants stores will trade under the Hella Good name.
Stalactites was in the media last month, when Greek tennis star Stefanos Tsitsipas launched his own souvlaki at the restaurant during the Aussie Open.
The Greek restaurant has only bestowed the honour once before — when Marcos Baghdatis made it to the Australian Open final in 2006.
Despite this, Calombaris’s food empire is likely to go into liquidation with up to 200 unsecured creditors expected to be burnt by the collapse.
Five other Jimmy Grants premises remain unsold.
Administrators have been working feverishly to find new owners for the 12 venues and save some of the 400 jobs the empire supported.
It is now believed more than half of those jobs won’t be saved, with only five sales likely to get across the line.
Administrator Craig Shepard said there had been lots of interest in the Jimmy Grants stores.
“There was considerable interest in the Jimmy Grants stores with more than 30 enquiries, but acceptable offers were concentrated on just a few of the venues,” Mr Shepard said.
“The proposed Emporium and Fitzroy asset sales reflect the commitment of the purchaser and Administrators to reaching an acceptable agreement in the short time since the appointment.”
KordaMentha does not expect to make any more sales and will recommend creditors vote to liquidate the company at a meeting on March 17.
Mr Shepard said the remaining seven venues had run out of time.
“We do not currently hold offers capable of acceptance for the remaining seven venues as we have run out of time. We encourage any further expressions of interest to be made direct to the relevant landlords.”
KordaMentha Restructuring will release a report on the group’s affairs on March 10 in advance of the second meeting of creditors on March 17.
Shepard advised the creditors at the meetings held today that he expected the companies to be placed into liquidation at the second meeting.
The meeting was also told employees were owed $400,000 in leave payments. Other redundancy costs could take this to over $1 million. KordaMentha will help employees access the Federal Government program to ensure staff are paid these entitlements.
Upon liquidation, KordaMentha will assist former employees to access the Fair Entitlements Guarantee scheme for any unpaid entitlements.
The 3pm meeting was held at KordaMentha’s Rialto Tower headquarters and was attended by about 80 people.
Neither George Calombaris or the rich lister who ploughed millions in to try to keep the business alive – Radek Sali – were present.
It is understood the secured creditor Commonwealth Bank will get about $1m, it is estimated the bank is owed up to $10m.
There are about 200 creditors, ranging from tradesmen owed small invoices to the larger organisations like the bank and the Australian Tax Office.
The administrators report on the whole matter will be delivered a week before the liquidation vote.
The first meeting of creditors comes a day after restructuring experts KordaMentha yesterday announced the first asset sales in the administration of Calombaris’ MAdE Establishment group.
A market rumour is that the business could go into liquidation at a March 27 meeting.
Yesterday administrators said they had agreed on terms for the sale of assets and the assignment of leases for the restaurants in Brunswick, Kew and Brighton.
KordaMentha administrator Craig Shepard said the purchasers of the Kew and Brighton venues had experience in the hospitality industry and were planning to contact former employees of the two restaurants to discuss new job opportunities.
“We are pleased to see three of the venues reopening,” Mr Shepard said.
“There has been enormous interest in the venues, but transitioning the businesses has been complex and time-consuming.”
The rebranded Crofter Dining site — which served as the original Hellenic Republic — has been taken over by husband-and-wife team Andrew and Pam Kavanagh, who run barbecue-focused The Que Club in Fitzroy North.
Andrew Kavanagh confirmed to the Herald Sun the business would be relocating to the Crofter site, possibly with a soft opening in mid-March, and the Que Club would expand its dinner hours.
The growth would mean taking on many of former Crofter chef Matt Wilkinson’s suppliers and also possibly former staff.
Asked what it was like to step into one of the venues, Mr Kavanagh said it was “quite surreal”.
“It does have a bitter sweetness,” he said.
“I am very close to Matt Wilkinson, I would have loved to have seen his legacy continue after what happened, but that hasn’t happened.
“Having said that, I’m very appreciative it is us. It is a super iconic site. To have Matt’s DNA in that kitchen means I have a responsibility to continue that legacy.”
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MAdE appointed restructuring experts KordaMentha on February 10 as it collapsed into voluntary administration.
More than 400 staff have remained in limbo as administrators try to find new owners for the 12 venues.
Landlords are said to be working with the administrators KordaMentha to try to get deals and avoid a long drawn out vacancy.
KordaMentha are not expected to drag out the sales process for too long a time as the business is without funds — so cannot accrue more debt.
Administrators Craig Shepard and Leanne Chesser, of KordaMentha, have said up to 15 parties were interested in the leases and other assets such as fittings and furniture.
Staff were paid outstanding wages and superannuation by Made the day it shut its doors.
Some staff will be owed holiday and long service leave which can be covered by the federal Fair Entitlements Guarantee.
Calombaris has put his Toorak mansion on the market.
It is believed Calombaris and major investor Radek Sali are expecting to get nothing back from the administration fire sale.