Rosella food company goes into receivership

Vegetable growers have expressed concern about sauce maker Rosella going into receivership.

As well as the Sydney-based Rosella, Gourmet Food Holdings owns New Zealand-based Pitango, and Waterwheel which operates in Dandenong in Victoria.

Receivers Ferrier Hodgson say Gourmet Food Holdings's secured creditor had lent the company support for an extended period while trying to find a buyer for the company.

However, a buyer could not be found and the receivers say they will urgently review the company's operations.

"The receivers will be undertaking an urgent assessment of the financial position of the group," said Ferrier Hodgson partner Steve Sherman.

"We will be engaging in discussions with key stakeholders, including employees, customers and suppliers to determine whether operations can be continued."

The receivership comes after the secured creditor had appointed voluntary administrators last Friday.

Food grower concerns

Primary producers say the collapse of the company behind the Rosella brand is a sign that Australia's food security is at risk.

Ausveg spokesman, Hugh Gurney, says the food processor is just one of many in the last 18 months to collapse.

He says when processors close, there are less market options for farmers.

"When dealing with something that is perishable, such as fruit and vegetables, you really need to have those options otherwise the fresh market is your only option and, if that is not available to you, you really can't sell your produce," he said.

"We'd really like to see some work alongside the Federal Government to ensure there is greater support for the industry, otherwise there is a good chance our nation will lose the ability to grow and process in the future, and this ultimately places the future food security of the nation at risk."

Jobs at risk

Ferrier Hodgson says an expressions-of-interest campaign will be run over the next couple of days to try and identify potential buyers for the company.

The receivers say the company employs 275 people, split between 159 company staff and 116 contractors.

Gourmet Food's Rosella plant in Sydney employs 110 people, Waterwheel in Dandenong has 140 staff, and Pitango in New Zealand employs 25 workers.

The Australian Manufacturing Workers Union's Tim Ayres says workers at Rosella's Seven Hills plant in Sydney only found out about the situation on Monday morning.

He says the union has been assured by the administrator that it will try to protect jobs and sell the business as a going concern.

"These people are totally taken by surprise at the developments today and are only being briefed as we speak about the circumstances that the company finds itself in," he said.

"People are very concerned leading up to Christmas with the prospect of job losses, but not a single person has lost their job today and people will not lose their jobs during the course of this week.

"This is absolutely about trading through and making sure that all of those jobs are protected."

Source: ABC News, 4 December 2012