Collapsed motorcycle retail giant Peter Stevens’ staggering $65m debt revealed

The mammoth debt of collapsed Australian motorcycle retailer Peter Stevens has been revealed, with creditors facing losses of over $65m including millions in customer deposits.

The staggering debt of collapsed Australian motorcycle giant Peter Stevens has been revealed. Picture: Supplied

The staggering debt of collapsed Australian motorcycle retail giant Peter Stevens has been revealed, with creditors facing losses of over $65m including millions in customer deposits.

Peter Stevens Motorcycles made headlines last month after it collapsed into administration, putting an estimated 400 jobs at risk.

Established in 1970 by the Chiodo family in Melbourne, the company is one of the biggest motorcycle retailers in Australia, with 15 dealerships across Victoria, New South Wales, South Australia and Western Australia.

The business, which employs hundreds of workers, owes over $1.6m to its employees, a new report by director Luc Favre lodged with the corporate regulator reveals.

It also collapsed with a whopping $2,131,808 in customer deposits.

The company owes $318,586 in GST and $4.5m in deferred tax to the tax office, and over $4m to related entities VC Motorcycles and Motorcycle Dealership Group.

Peter Stevens Motorcycles made headlines last month after it collapsed into administration. Picture: Supplied

Banking giant Westpac was listed as a secured creditor owed $7.6m and $26.5m worth of retail floor plan liabilities was also recorded as secured.

Retail floor plan financing, often used by car dealerships, involves a short-term loan used to purchase inventory, repaid as items are sold.

Mr Favre listed a lease liability of $15.1m, with the total amount the company owes to its creditors totalling $65.9m.

More than $1.4m is owed to the company, including from debtors for spare parts ($344,691), debtors of bikes ($51,842) and prepayments and other debtors ($1m).

Mr Favre declared various assets owned by the company, including inventory ($42m), cash on hand and at the bank ($1.2m) and a deferred tax asset – an item which can be used for future tax relief – ($5.7m).

In the first meeting of creditors, appointed administrators Craig Shepard, Michael Korda and Andrew Knight of KordaMentha said it was too early to determine whether any unsecured creditors claims would be paid out.

“Craig mentioned that it was too early to provide a conclusive answer as the results depend on the sale of business outcome,” minutes of the meeting lodged with the Australian Securities and Investments Commission read.

“Craig stated that by law, if a customer has paid a deposit, they become a creditor of the company.

“It was suggested that if the customer has paid by credit card, that they could request a chargeback to the card issuer.”

Banking giant Westpac was listed as a secured creditor owed $7.6m. Picture: Google Maps

The administrators are continuing to trade the business while seeking immediate expressions of interest in all or parts of the business.

Mr Shepard told creditors they were working to sell the business “as quickly as possible”.

The minutes noted in the past 10 days a data room was established within 24 hours of the appointments, advertisements were put in media and administrators had received inquiries from multiple interested parties within days.

“Craig noted expressions of interest were for a combination of all or parts of the business,” the minutes read.

All sites are still open for trade but Mr Shepard said the administrators had paused online trading.

He said the administrators were continuing to honour the terms of employee contracts and entitlements accrued post appointment.

“Craig also noted that the shareholder had provided funding to ensure that post-appointment entitlements were paid,” the document read.

Peter Stevens has four main dealer sites – Ringwood, Dandenong and Geelong in Victoria, and Adelaide in South Australia.

The business, which had an annual turnover of around $250m last year, includes new and used motorcycle sales, parts and accessories, servicing, and finance and insurance offerings.

Its dealer network comprises Peter Stevens Motorcycles, as well as Ducati, Triumph and Harley Heaven franchise dealerships.

Peter Stevens represents eight of the top 12 selling motorcycle brands in Australia, including Harley Davidson, Yamaha, BRP, Ducati and Triumph.

Originally published as Collapsed motorcycle retail giant Peter Stevens’ staggering $65m debt revealed