IFS's service vans

It's business as usual at failed forklift sales and rental operation, Independent Forklift Services (IFS), according to administrator Andrew Fielding.

National insolvency firm PPB took control of the business last Monday at the request of director Graeme Dillon.

It is still unclear how deep in debt the Brisbane-based business may be, with a number of financiers owed anywhere around A$10 million, according to Fielding. There is also a significant sum owed to staff in the form of severance pay, entitlements and superannuation. This debt could be as much as $200,000.

Fielding is confident of selling the business as a going concern and has had a number of promising responses after advertising the business in the mainstream business media.

Around half of the approaches have come from existing players in the equipment sales and hire industry, the rest from other parties.

Interested parties have until October 19 to submit offers for the business in writing.

For now, Fielding has scaled back the equipment sales operations to focus on servicing around 300 lease contracts, and has had to "let some sales and support staff go".

Since sales can take some time to reach fruition, he says, it makes more sense to focus on the lease operations which are generating revenue.

The administrators are also maintaining IFS's service operations to support the rental fleet.
IFS has around 700 forklifts for sale, but Fielding insists he won't be running a "fire sale", and he's determined to get market value for the equipment.

He is very aware, he says, of the dangers of flooding the market with second-hand forklifts.

At this stage, there's no explanation of what "went wrong" at the business which last showed a profit in 2005.

The director, according to Fielding, was having difficulty getting financial information out of the systems before calling in the administrators.

Fielding admits that it's difficult to unravel the current situation because a lot of stock has been moved around from client to client, and there's some confusion about the financing status of various pieces of equipment.

He is working with several financier creditors to determine the status of the lease fleet and urges current customers to continue meeting their lease obligations. "If they don't pay, we can't pay the staff," he insists.

IFS, with headquarters in Sumner Park in Brisbane's south west, has operations in Townsville, Mackay, Brisbane, Sydney and Melbourne.

QV Forklifts, also associated with Dillon, is unaffected by the financial woes at IFS.
Managing director David McGuigan says while QV Forklifts has had a long-standing professional association with Independent Forklift Services, it "has always remained a separate business".

Fielding expects to release more information on IFS's financial position by the end of the week.

Administrators usually have 28 days to rescue a business in voluntary administration.

At that point, they are required to call a creditors' meeting at which the business is either wound up or subjected to a deed of arrangement. Under the deed, creditors accept an offer against the debt, usually funded by the sale of the business or its assets.

In its heyday, IFS claimed to be "the largest second-hand forklift sales operation in Australia", also selling into the Asia Pacific region.