George Calombaris is embroiled in fresh scandal after popular frozen yoghurt chain Yo-Chi, backed by the TV chef, has refused to repay a $140,000 debt.
George Calombaris is embroiled in fresh scandal after popular frozen yoghurt chain Yo-Chi, backed by the TV chef, has refused to repay a $140,000 debt.

Calombaris caught in fresh debt scandal

A frozen yoghurt chain backed by George Calombaris has refused to repay a $140,000 debt owed to his collapsed restaurant group which is falling back on the taxpayer to cover outstanding wages.

The knock-back comes despite the taxpayer being called on to cover a $1.32 million employee wage and entitlements bill after the liquidation process failed to raise enough money to cover those costs.

Multimillion-dollar properties owned by Mr Calombaris and his wealthy restaurant backers including former Swisse vitamins boss Radek Sali cannot be targeted to raise funds because the debts are owed by their companies, not the individuals.

The only way those homes could be targeted would be if their Made Establishment restaurant empire had of traded while insolvent - something which liquidator KordaMentha has ruled did not happen - or if they had been required to provide the properties as collateral when accessing business loans.

Commonwealth Bank, the major Made creditor, is owed $8.5 million but did not require Mr Calombaris or Mr Sali to provide personal guarantees on lending undertaken by the high profile restaurant group.

Radek Sali and George Calombaris Picture: Fiona Hamilton Photography
Radek Sali and George Calombaris Picture: Fiona Hamilton Photography

Mr Calombaris' property portfolio includes a faux French-provincial style Toorak mansion bought for $4.75 million in 2013, listed in his wife Natalie Tricarico's name, and a sprawling Arthurs Seat house bought for $2.2 million earlier this year, registered to a company jointly owned by the couple.

Made, which employed 364 staff across a restaurant stable including The Press Club, Hellenic Republic and Jimmy Grants, collapsed in February.

Its downfall followed a public backlash to a $7.8 million wages underpayment scandal.

Up-market yoghurt chain Yo-Chi, whose owners include Mr Calombaris and Mr Sali, emerged as the sole Made group restaurant to avoid insolvency.

It continues to operate outlets in Hawthorn, Malvern, Carlton and Balaclava.

The latest report from liquidator KordaMentha shows it approached Yo-Chi to collect an outstanding $140,000 debt in April.

It was made as in inter-company loan.

"Following correspondence with one of Yo-Chi's shareholders, the liquidators concluded that it would not be commercial to pursue the outstanding loan balance further as Yo-Chi has minimal cash and recoverable assets," the KordaMentha report says.

"In addition, Made Establishment's claim is as an unsecured creditor of Yo-Chi and we are aware of a secured creditor who would rank ahead of Made Establishment's claim in any formal insolvency process."

George Calombaris' portfolio included a $4.75m house in Toorak. Stuart McEvoy/The Australian.
George Calombaris' portfolio included a $4.75m house in Toorak. Stuart McEvoy/The Australian.

Both Mr Calombaris and Mr Sali declined to comment on the transaction.

KordaMentha has raised about $820,000 from the liquidation process to date which includes earning $222,000 from an online auction of restaurant equipment and food inventory.

These funds will be directed to CBA - the first ranking secured creditor - with KordaMentha warning other parties owed money not to expect a return.

Among these are Australian Taxation Office, owed $2.3 million, and unsecured creditors such as suppliers and landlords who are owed $1.5 million.

Former Made employees are owed $1.32 million with the overwhelming bulk of this related to annual and long service leave and redundancy and termination entitlements.

KordaMentha has directed them to seek assistance from the Fair Entitlements Guarantee, the government scheme of last resort that covers worker entitlements when not enough money can be raised during an insolvency.

Its report notes there is 28 workers who will not be able to make use of the government scheme as they are not citizens or permanent residents.

Parties close to the liquidation point out Mr Sali or Mr Calombaris cannot direct specific money to former employees as any funds they provide would be seized by the liquidator and directed to the CBA as the secured creditor.

They also note that Mr Sali tipped $11.5 million into the business after he bought in it early 2017 which paid out wage underpayments incurred before he was involved in Made.

john.dagge@news.com.au

 

MORE NEWS

THE RISE AND FALL OF GEORGE CALOMBARIS

CALOMBARIS EMPIRE'S $20.7 MILLION IN LOSSES BEFORE COLLAPSE

FOOD EMPIRE COLLAPSE LEAVES CREDITORS $22.3M OUT OF POCKET

Originally published as Calombaris caught in fresh debt scandal



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