The Company behind Harvey Norman Commercial in NSW, which has been described as the “most profitable Harvey Norman store in the world, “has been placed into administration with what is believed to be debt in the millions.
Among the creditors hit by the placing of Druin Pty Ltd the franchisee of Harvey Norman Commercial NSW, into voluntary administration are suppliers, several current staff and former staff who claim that they owed tens of thousands in back superannuation payments.
See original story here re superanuation.
Three weeks ago, ChannelNews exclusively revealed. that the former franchisee of Harvey Norman Commercial, Alan Stephenson the sole director and secretary of Druin was sacked by Harvey Norman management following a forensic audit of the books and the charging by NSW Police of two former senior staff members.
Stephenson is a multi-millionaire who owns properties in Coogee NSW, Horse Studs and is believed to be the owner of the property where Harvey Norman Commercial is located in Taren Point NSW.
ChannelNews has been told that “most likely Harvey Norman will pay out suppliers”. This has not been confirmed as suppliers had to invoice Druin Pty Ltd. We have also been told that a new franchisee Company is set up to run the existing business.
Insurance Companies claim that if Harvey Norman does not pay out suppliers who have insurance cover on the stock supplied to Druin a review of costs associated with supplying Harvey Norman franchisees could result in a significant increase in costs.
“Several Harvey Norman franchisees are currently struggling due to a downturn in business, and due to the franchisee structure of the Harvey Norman business questions are being raised about the risk on stock supplied to them vs Derny Pty Ltd the Harvey Norman business taking liability for stock supplied to their franchisees”. Said one supplier.
The Australian Securities and Investment Commission has been advised that Alan Shepard of Sutter Shepard a NSW based receiver, has been officially appointed as receiver and manager and is in discussions with both Harvey Norman and creditors.
At this stage Alan Stephenson who at one stage wanted to be kept on at Harvey Norman wrote to Harvey Norman management claiming that head office operations managers at Harvey Norman head office in Flemington NSW should also be taking the blame for what was discovered in the accounts at his Commercial operation.
Some insiders are claiming that the debts could be over $200M.
A horse farm owned by Stephenson at Bargo in New South Wales is set to go up for sale shortly, it’s not known whether the proceeds of the sale will be used to pay out creditors.
Stephenson a close friend of Harvey Norman Chairman Gerry Harvey had worked with Harvey Norman for over 30 years.
In his email to executives at Harvey Norman he days before he weas sacked .
“I am disappointed to be leaving so soon and I had hoped and expected a transition period so we could work towards my goals of retirement but it’s not to be.
We all know it has been a very difficult 2 years compounded by the staff theft of approximately $600,000 and the sloppy procedures relating to our Aged Trial Balance over a 20-year period (by our operations Manager at the time and our Flemington teams lack of follow up).
So, it has not been a pleasant time. Prior to the last 2 years we were the most profitable Franchise in the Harvey Norman world.”
The two people charged to date are Troy Robinson, the IT Manager, and Kerry Dalton, the former Administration Manager.
