Former Woolworths bosses slams Deloitte's administrator role
Woolies' former bosess unhappy with Deloitte's role as bank advisers and then administrators
Woolworths’ former bosses have put the boot into the company’s administrators
Deloitte.
Woolworths Group chairman Richard North and Steve Johnson claimed that
Deloitte’s role as both adviser to the company’s banking syndicate and then as
administrator, was a potential conflict of interest, reported
the
Daily Telegraph.
“I think it is unsatisfactory that advisers to banking groups on their
options can then become administrators,” said Johnson.
“The order of magnitude of fees is a factor of many times higher for an
administration, compared to giving advice.”
North believed that management plans to restructure the business would have
saved jobs and stores.
Deloitte
partner and joint administrator at Woolworths Neville Kahn vigorously defended
the firm’s work.
He said the company’s directors had approved Deloitte’s practitioners’
appointments to Woolworths, and fees had no bearing on their advice.
“The reason that Woolworths failed was because it was making substantial
losses. Its working capital was impacted because of the withdrawal of credit
insurance and it ran out of money. The directors were the ones who appointed
administrators,” said Kahn.
Further reading:
Deloitte: Woolworths’ banks to be
paid in full