Victorian solar energy company collapses into liquidation with $3.8m in debts

Creditors voted to place the Victorian business into liquidation and will be pursuing the director personally over the debt.

EXCLUSIVE

A Victorian solar energy company has plunged into liquidation with debts of $3.8 million.

Creditors voted to place G-Store into liquidation rather than have their debts wiped at a fraction of the cost on Friday afternoon.

G-Store, headquartered in Melbourne’s Malvern East and also with premises in regional Victoria in Warragul, specialised in installing custom solar energy and sustainability options into homes.

But last month, the business appointed Philip Newman of insolvency firm PCI Partners as administrator.

All 20 staff lost their jobs as a result. They learned that the business had gone under when administrators showed up at their workplace and had the locks changed.

Just past noon on Friday, creditors discarded the option of taking G-Store out of administration and returning the control to its sole director, Dion Epstein. Instead, they forced the company to be wound up into liquidation.

G-Store’s director, Mr Epstein, personally guaranteed $1.182 million worth of loans. On top of that, the business owes 139 unsecured creditors $2.2 million.

With his company now in liquidation, secured lenders could apply to bankrupt him to recover their money.

Melbourne solar company G-Store went into liquidation on Friday afternoon.

Mr Epstein’s father, Robert Epstein, is the director of one of G-Store’s secured creditors, Coltvale Pty Ltd.

Coltvale Pty Ltd had put forward a deed of company arrangement (DOCA), which is where they offer to buy back G-Store and wipe its debts at a fraction of the cost.

The DOCA put forward would have given creditors 2.2 cents back for every dollar they were owed.

However, this offer was roundly rejected, according to two people who attended the meeting.

At the decision on Friday afternoon, five people voted in favour of the DOCA while the remaining 34 voted to have the company shut down permanently instead.

“Everyone came for blood,” one person familiar with the matter told news.com.au.

News.com.au has contacted Dion Epstein for comment.

In a statement to news.com.au before the company’s liquidation, Dion Epstein said he was “bitterly disappointed” and “tremendously sorry” that his vision to move into solar powered homes had failed.

G-Store specialised in renewable energy housing solutions.

Creditors had previously raised concerns about G-Store.

Chris Taylor, whose business Reclaim Energy is owed $200,000, said he would “go all the way” into bankrupting the director of G-Store.

“To walk away from $1.2 million worth of liabilities is just ludicrous,” Mr Taylor said when discussing why he would be voting against the DOCA.

Mr Taylor’s anger is compounded by the fact that he dropped off $100,000 worth of stock to G-Store on January 31.

Just two days later, G-Store went into administration. A report lodged with ASIC shows that G-Store was already in discussions with administrators when Mr Taylor dropped off his stock.

Dion Epstein told news.com.au that when the order for the stock had been placed, he was not in discussions with administrators and he intended to pay the debt.

“I had a meeting (with G-Store) on February 2 booked,” Mr Taylor recalled.

“I got to the front door and I got a message saying they can’t meet with me.

“By lunch time I’d been notified (that they were in administration), by 1pm I was standing in their premises.“

Mr Taylor said he rushed to the warehouse to recover his stock – but the administrators turned him away.

“$200,000 is a massive hit,” Mr Taylor lamented.

“Particularly when $100,000 is just sitting on the floor” in G-Store’s warehouse.

His company, Reclaim Energy, has started the process of taking legal actions against the administrators to reclaim what he says is his.

“I’ve got a personal guarantee on mine (the credit),” Mr Taylor added. “I’m happy to bankrupt him (Mr Epstein).”

Mr Taylor also added that he has terminal bone cancer but is still paying his debts and was unhappy with how G-Store had handled the situation.

Creditors said they “came for blood” in the meeting.

A person with knowledge of the matter also raised some other concerns about G-Store’s descent into administration.

“There was this craving for larger and larger customer deposits,” they said, saying in some cases G-Store asked for as much as 60 per cent of the total cost of the installation from customers.

“The business was running for at least five years on customer deposits.”

On Consumer Affairs’ Victoria’s website, it says a “usual” deposit is 10 per cent of the total price.

Dion Epstein acknowledged there “were variable deposits from 10 per cent upwards” and said this was “depending on job size which is in line with the solar industry”.

“This was always agreed with the customer prior to the contract.

“The owners independently financed the ongoing capital costs of the business to a significant amount.”

This person also noted G-Store’s strong family links with the business.

Mr Epstein’s wife lent $85,000 to the company to prop it up.

Meanwhile, a family trust is indebted to G-Store to the tune of $247,000.

It’s also understood Mr Epstein’s father-in-law is a landlord and owns one of the premises where stock is being held.

“The Administrators have control of the stock and the family have been cooperative with the administration process,” Dion Epstein said.

The administrator, Mr Newman, said technically the company had been insolvent since at least 30 June 2021.

However, he pointed out it was more likely the business had access to finance, most of it from the Epstein family, which meant it only became insolvent for a “short period of time” before going into administration last month.

The administrator, Mr Newman, has been contacted for comment.