After months of rumours and grumbling from unpaid suppliers, pioneering Melbourne digital print business On Demand has collapsed and is in liquidation – but not before ‘licencing’ its name and kit to a company with Con Maniatis, one of On Demand’s managers, as its director.
ProPrint points out that On Demand has no connection whatsoever with Chris Pilz's On Demand Sydney.
On Demand’s high profile owner Bruce Peddlesden tells ProPrint he will not be involved in the licensed business, Production Printing (Aust) Pty Ltd, trading as On Demand, but may consult with them.
Peddlesden says the new company is ‘not an attempt at a phoenix’ and was only set up to keep the business trading while the liquidator fields offers to buy it.
He says while the new company will use the On Demand kit, its ownership has not been transferred to the new company, and will be under the control of liquidators.
Production Printing (Aust) directors are Maniatis, former FAB Equipment man Tim Farrell, and Michael Wu, director of Ability Press in Melbourne, and they are hoping to buy the business.
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The licensing move effectively means the On Demand business will carry on trading from the same premises with the same equipment, but without the debt.
The rest of the industry is eventually likely to pay for that debt either directly through unpaid or partly paid invoices, or through higher prices from equipment and consumables as industry suppliers seek to recoup their losses.
On Demand entered liquidation yesterday and liquidators are arriving at the company’s Melbourne office today to take over.
Peddelsden says On Demand’s cashflow woes stem from the disastrous takeover of Melbourne digital printer Document Printing Australia in August 2010, which was later revealed to owe more than $5m when its leftovers were liquidated the next month.
Peddelsden claims he was given ‘very bad due diligence’ by a third party based on ‘fictitious information’ that meant he took on significant debts and the promised revenue quickly evaporated.
The news will not be a major shock to the Melbourne print community, but it is another sad day for the printing industry as Peddlesden’s company was something of an icon, and was thought to be the biggest digital printer in the country.
It comes in the same year high profile Sydney digital print business Group Momentum went broke.
Peddlesden says he hopes the liquidator will choose to sell the business to the trio behind Production Printing (Aust) because ‘they are good operators’ he has worked with and they have ‘made a commitment to keep the staff’.
It is not yet known how much On Demand owes its creditors, but numerous upset print suppliers have contacted ProPrint over the past few months saying they have not been paid since early in the year. If past records are anything to go buy it is highly unlikely creditors will see much of their money.
Industry sources say numerous equipment manufacturers including Canon, HP Finance and Currie Group are also angry at a lack of financing payments, and that Fuji Xerox removed multiple digital printers months ago as a result.
Peddelsden says the paper merchants have been dealing on a cash only basis for some time now, and whether the other suppliers will get their money back depends on how much the liquidator is able to get for the business.
Peddlesden also says as he is in poor health he was unable to devote the time and energy it would have taken to right the ship.
“I think I could have traded out of it eventually, but with my health has just gotten too bad to continue the fight. My health has to come first,” he says.
“Things would have continued to get worse so better to take this route than go into even more debt.”
He says he will take time off to get healthy and would like to return to printing afterwards in some capacity if possible.
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A letter to suppliers provided to ProPrint says On Demand has ‘licenced’ its name, and sales and production facilities to Production Printing (Aust) Pty Ltd.
“All the existing facilities, equipment and staff will be trading as this new company, so it will be business as usual. The only change will be in the payment of accounts,” the letter says.
The letter advises that from October 16 suppliers will need to invoice the new company, which according to ASIC listings was only registered on August 22.
October 16 is the same day On Demand Pty Ltd changed its name to Bruce Peddelsden vehicle BAP Nominees (Vic) Pty Ltd.
The letter to suppliers is signed by On Demand operations manager Con Maniatis, calling himself director of Production Printing (Aust).
Multi-award winning On Demand is one of the most high profile digital printers in the country, with a reputation for installing the latest technology including the highly specified Oce ColorStream high volume webfed inkjet printer which it has recently upgraded to 128 metres a minute print speed.
The licensing tactic was also recently used by Bhaska Datta’s collapsed company Media Options, it enabled Sureprint, a business owned by his sister-in-law, to run the Media Options business while a buyer was sought, and resulted in a year long battle between Sureprint and CMYKhub for ownership of Media Options, a battle CMYKhub has now won, although some elements are still uncertain.
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