Rawson Graphics has swooped in to salvage the business of Group Momentum after more than $250,000 of debts forced the multi award-winning Sydney digital printer into administration.
The deal sees Rawson acquire Momentum’s intellectual property, software and clients with four or five of its 11 staff, including director David Minnett, have been retained, according to administrator Alan Hayes.
Momentum’s Crows Nest facility will also close and the equipment will be auctioned off next Tuesday (February 18) to help pay debts.
Hayes says Momentum owes about $250,000 to trade creditors and smaller amounts to its bank and the Australian Tax Office and was unable to repay them after the unexpected loss of a major client, greeting card provider Moonpig, in January, which represented a quarter of Momentum’s business, and another client two years ago worth about the same.
[Related: Momentum in administration]
Rawson director Lachlan Finch says the two companies had a long relationship and a merger had been discussed for some time but Momentum’s collapse had forced their hands.
“With the industry’s ongoing consolidation we thought a merger might be good for both businesses, and while this is not the most desirable way to do it, it’s now or never,” he says.
He says Rawson, which merged with Artvue Printing only last May, will assess the need for Momentum’s equipment and remaining assets on a case by case basis leading up to the auction.
“Our objective is to offer Momentum’s clients the same or better level of service and be able to offer them offset as well,” he says.
Minnett’s job title at Rawson is yet to be determined but he says he will be working in the marketing planning, sales and business development areas.
“It’s my forte and I’ll be able to be more focused than when I was running a whole company,” he says.
Minnett is happy Momentum’s clients will be retained and says they will be better served by a larger operation.
“There’s lots of synergies between us and Rawson, we do things they don’t and unlike us they have offset so they are complementary businesses,” he says.
“Out of bad comes something good for some of us. Unfortunately it’s happened under these circumstances but consolidation is what is happening in the market.”
Finch looks forward to working more closely with Minnett and says he will be “an integral figure with great sales ability who will put value into the company”.
Hayes says the deal has been signed off and it’s too early to tell exactly how much money will be recovered from the business for trade creditors but the bank will get everything back and employee entitlements will likely be taken care of. Rawson will not be helping settle any of Momentum’s debts.
Rawson won the NSW PICA gold last year for its work on Justus magazine, and a silver for its Revlon Colourstay Presentation Book. It took delivery of a new Komori H-UV 29” five-colour press last year.
[Related: Rawson wins PICAs]
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How does Rostone Print sell all the equipment and client list to Oxford Group 1 day then appoints an administrator the next, leaving no assets for unsecured creditors such as employees and merchants again! As Im aware the deal sees Oxford acquire Rostones Equipment and clients with a few select staff, including director David Newell and Enda Oshea. Most people knew the company was rocky for quite a while yet not 1 word has been mentioned in any media. Please Explain!