HARMONY Agriculture and Food Company is back freely trading Wagyu beef for export, almost two years after it was placed in liquidation with debts of $29.4 million.
At the time of settlement last month, a core debt of about $24m - which was owed to National Bank Australia (NAB) and its receivers at the time of liquidation - was reduced to $6.4m.
Merricks Capital backed Harmony group financially, and an additional investment of $27.5m was made by primary shareholder Wenfang Wang to major creditors last year.
Harmony feeds 17,000-head cattle across three feedlots including two owned facilities at Dimboola in western Victoria and Westbeef at Kalannie, WA, and custom-feeding F1 Wagyu at Hell's Gate, southern NSW.
During the period of receiver manager appointment, the group continued to profitably operate its F1 Wagyu supply chain and supplied global markets with beef under its Black Opal and Omino brands.
HAAFCO chief executive officer Anthony Fellows led the business through receivership and is set to continue as CEO, succeeding Stephen Meerwald, who left the business.
Mr Fellows said as the company emerged from a challenging period, business could not be better positioned to move forward and grow.
"Under the control of receiver manager Ross Blakeley, we were able to maintain our staff and business structures ensuring administrative capabilities are 100 per cent ready to emerge today."
In August 2019, New South Wales custom feedlot operator JHW Paterson & Son appointed liquidators to recover $5.4m owed by Harmony Operations Australia.
At the same time the NAB, a secured creditor to Harmony, appointed receiver managers to take charge of the company's assets.
Mr Fellows said Harmony's supply chain was both full and secure with supply partner JHW Paterson, providing surety for all clients that business would continue to operate at full volumes in the future.
"Over the past 18 months the business has developed a loyal client base globally for both our Wagyu brands," Mr Fellows said.
"Most recently both our brands were awarded multiple silver and bronze awards in the Australian Wagyu Association Branded Beef Awards, demonstrating the high quality of our products.
"In seeking re-finance options, multiple parties expressed interest in offering solutions to the business.
"The decision to proceed with Merricks was driven by their strong understanding of the agricultural sector, further enhanced by their presence in soft commodities.
"This was deemed essential to mitigate risk in an ever-increasingly challenging commercial environment."
Merricks Capital head of agriculture Dan O'Donoghue said the business was pleased to finance the restored Harmony business and looked forward to seeing the business perform strongly outside of receivership.
"This investment builds on our recent track record of providing finance to Australian Agricultural businesses as we continue to help meet the capital gap in the sector," Mr O'Donoghue said.
