Long-established clothing and textile manufacturer Lane Walker Rudkin Industries was last night placed into receivership by its bankers.
Brian May-Smith and Stephen Tubbs, of BDO Spicers, were appointed joint receivers and managers of the LWR operations.
The appointment was made by LWR's bankers to protect the financial position of LWR and its subsidiary, Pod, while issues facing the group were resolved.
Mr Tubbs said the LWR operations were currently unprofitable and had incurred a substantial increase in bank debt.
The group, started in Christchurch in the 1880s, is owned by Christchurch businessman Ken Anderson, who bought LWR in 2001 and Pod in 2007.
Mr Tubbs said that while the receivers now had full control over all the businesses, there would be clear distinction in direction and day-to-day management between the LWR and Pod operations.
"Indications available up to this point would appear to indicate that the Pod operations are profitable and cash positive. These operations will be `ring-fenced' under a dedicated board and management reporting to the receivers."
The chief executive, Malcolm Walkinshaw, and chief financial officer, George Gin, would remain in place.
It was understood the bank would provide additional finance to ensure the short-term liquidity and flexibility of the Pod businesses.
However, the position was less clear regarding the LWR businesses and there was a need for further action before any future moves could be decided.
"What we can be sure of is that the decision to appoint receivers has not been taken lightly. It has become unavoidable through a significant deterioration in the overall financial position of the LWR businesses," Mr Tubbs said.
Until an assessment of the LWR operations had been made, no decisions would be taken about the ongoing trading operations.
Continued support from employees, suppliers, customers and other stakeholders would be vital to maximise the chances of recovery for each business in the group. More information should be available in two weeks.
At a glance
LWR
• Started in Christchurch in 1880s by Sarah and Alfred Rudkin.
• In 1904, John Lane, Pringle Walker and Alfred Rudkin combined their respective operations to form Lane Walker Rudkin.
• Employs 470 people in Christchurch, Greytown, Pahiatua, Timaru and BrisbaneMakes textiles, hosiery, underwear and garments along with socks and sports apparel.
POD
• Comprises fabric maker Designer Textiles International, clothing designer and manufacturer Michele Ann and Mollers Homewares.
