Melba viable with government funding

Andrew Mathieson
An embattled Geelong fabric company with 120 staff remains viable, its administrator told creditors yesterday.
But Grant Thornton Melbourne said government support was “critical” to the survival of Melba Industries.
The company would need a new buyer after the closure of two Breakwater companies had damaged Melba’s bottom line, the administrator said.
The South Geelong mill went into voluntary administration last month but has continued to trade.
Lead administrator Matt Byrnes said the company was not trading at a loss but a “rather a small margin”.
Melba employs about 120 staff to supply protective clothing for firefighters and armed forces as well as components for the automotive industry.
Mr Byrnes said the company’s importance to manufacturing in Australia made it a bright proposition.
Huyuck.Wagner and Brintons Carpets both announced last year they would shed hundreds of Geelong jobs in a blow to Melba’s future.
Mr Byrnes said he reinforced to creditors at yesterday’s meeting that Grant Thornton was “pushing forward and trying to find a future for Melba”.
“Whether it’s a buyer or via a deed of company arrangement, which is a process that can happen out of administration, we think there’s a future for the Melba business in some form,” he said.
Mr Byrnes spoke to Melba suppliers about what their entitlements.
The administrators revealed to creditors that Melba also had shareholdings overseas in China and South Africa.
Mr Byrnes said Melba should be given priority from either a cash injection or Commonwealth grants amid cuts to the manufacturing industry.
“It’s not absolutely essential without that but we would say government support is critical for Melba going forward,” he said.
“When we say support, we mean support both moral, ethical and all other ways, but obviously funding assistance most of all.”
The administrators expect to hear next week from the court about a bid to extend a convening period for a further four weeks until April 28.