Austin Group in rough waters

MELBOURNE: Apparel wholesale company Austin Group has suffered yet another blow to its ambitious growth plans.

The Victorian-headquarted company has adjourned its Extraordinary General Meeting until April 30, following news that a significant shareholder has been placed into receivership. In addition to being a substantial shareholder of the company, Hawkswood Investments is the holder of six million Convertible Notes that were issued by Austin Group in December 2007.

Austin Group chairman Michael Abela was quick to assure shareholders the move would not impact the normal operation of the business.

"[We] have received legal advice confirming that the terms of the Convertible Notes are unaffected by Hawkswood being placed into receivership and that all rights and obligations attached to the Convertible Notes, and imposed on the parties by the Convertible Note Agreement, continue to apply."

In Austin Group's half year report for the period ended 31 December 2007, the directors said despite recent financial losses the company was to launch a dramatic restructure with the financial support of Hawkswood. Although this support has now fallen through, the board confirmed the company remain solvent and a going concern.

"It is important for our shareholders, customers, suppliers and staff to understand it is business as usual at Austin Group," Abela said.

Austin Group brands include Rochford, Playboy, Itsu, Crusty Demons and Billiecart.