ONE of Australia’s largest auction houses has entered voluntary administration in a decision to try and remove debts collected by previous owners.
Mossgreen chief executive and co-founder Paul Sumner said the move came after a key investor withdrew their funding, leaving the company is massive debt after recent expansions.
On Friday, the Australian Securities and Investments Commission revealed administrators had been appointed for Mossgreen Pty Ltd.
Only the day before, the company had thanked customers via Facebook for their support and announced their office would close over the holiday period.
Administrators from corporate advisory company BDO will oversee the financial assessment.
In a statement, BDO said the company will conduct “an urgent assessment of the business and will be exploring all options”.
Founded in 2004, Mr Sumner and wife Amanda Swanson oversaw Mossgreen’s takeover of New Zealand auction house Webb’s and the opening of its first Sydney auction rooms and gallery.
Businessman Jack Gringlas was a significant financial influence but was earlier this year bought out by Mr Sumner and Ms Swanson.
Mr Sumner told the Herald Sun Mossgreen planned to “restructure” the company but would keep all active employee contracts.
“Our employees are a critical part of our company and experience. Without them, the company would not be able to function,”.
The auction house mogul said financial advice found that the business could not function with this level of debt.
“We were advised to enter voluntary administration on the belief that it is the best was to clear historical debt, accrued through previous investors,” Mr Sumner said.
Mossgreen plan to open their 2018 on February 5 and items currently held under consignment to sell or buy will not be lost to their owners.