The business owed the ANZ Bank more than $2.5 million when administrators were appointed on March 7.

A further $1.655 million was owing to 122 trade creditors, including a number of Bendigo-based suppliers.

The company’s 25 employees were owed entitlements totalling almost $584,000 – about $115,405 of which was superannuation.

Debts to the tax office were estimated at almost $850,000. 

“It is our opinion that the company should be wound up as this is the only viable option available to creditors,” the administrators stated in documents sighted by the Bendigo Advertiser.

Creditors will meet for a second time next week to decide the fate of the company.

Keogh Manufacturing has been trading for almost 60 years.

It has racked up about $2.3 million in losses from 2016/17 until administrators were appointed.

“Although sales increased quite significantly during the financial years 17 and 18, the company’s direct costs also increased significantly and nullified the increase in sales,” the administrators assessed.

A shareholder dispute emerged as a ‘significant factor’ in the company’s failure.

Other factors cited by the administrators included poor strategic management, increasing overheads, increased competition, poor financial advice and poor productivity.

“In our opinion the company was balance sheet or technically insolvent as at June 30, 2017, (if not earlier) and manifestly insolvent at the start of the relation back period… on September 7, 2017,” the administrators wrote.

Whether the directors realised the extent of the company’s financial difficulties as early as then is, as yet, unknown.

“It is unclear until further investigations are completed as to when or if the company could source from directors or other parties funds to inject into the company to alleviate the insolvent position,” the administrators wrote.

“Other than an odd demand for payment by a creditor, the company did not face any mounting pressures from its trade creditors… therefore there was no reduction or circumstantial evidence confronting the directors that the company was in financial difficulty and had no avenue to resolve [its] financial position.”

The administrators are fielding expressions of interest in the business from four potential buyers.

A house associated with the company, in Woodvale, will also be put on the market.