You might not be familiar with the name Peter Stevens, but the giant motorcycle dealer tells a story that's becoming all too common in the motorcycle and powersports industry. It has gone into administration, which can't help but remind me that Arctic Cat was sold last year, and one of the powersports industry leaders, Polaris, had to make serious cutbacks last year, which will likely continue into 2025.
But Peter Stevens going into administrations isn't just bad for the owners—a lot of folks are getting screwed.
The retailer is $65 million in debt, and those losses are shared amongst creditors and customer deposits. A lot of folks are left holding the bag with this one, but the ones suffering most are the employees. An estimated 400 jobs are at risk, which is unsurprising considering this is one of Australia's largest motorcycle retailers, with 15 dealerships spread across the country. More worrying still is the fact that the business still owes more than $1.6m to its employees.
Next in line of the folks who are getting the raw end of the deal by Peter Stevens are the customers who have deposits with the retailer, which total $2,131,808. The business also owes over $4 million to related entities VC Motorcycles and Motorcycle Dealership Group, along with $318,586 in GST and $4.5m in deferred tax to the tax office.
Westpac, the banking giant, is a listed secured creditor that's owed $7.6 million and $26.5 million worth of retail floor plan liabilities. For those that are unfamiliar with retail floor plan financing, it involves a short-term loan from a financier, which is used to buy inventory, and the seller repays the loan as the items are sold.
Director of Peter Stevens, Luc Favre, has listed the lease liability as $15.1 million, which means the total amount the company owes is $65.9 million.
In the first meeting of creditors, appointed administrators Craig Shepard, Michael Korda, and Andrew Knight of KordaMentha gave some insight into what all this means for the company's creditors.
minutes of the meeting lodged with the Australian Securities and Investments Commission stated, "Craig mentioned that it was too early to provide a conclusive answer as the results depend on the sale of business outcome... by law, if a customer has paid a deposit, they become a creditor of the company."
Apparently, there is interest from third parties to buy a combination or all parts of the business meaning the creditors might not be totally screwed. But what'll actually happen remains to be seen.
