CommTel Network Solutions - Case Update

Victoria-based telecommunications supplier CommTel Network Solutions has been acquired by ASX-listed GenusPlus Group in a deal that will see most employees’ jobs saved.

CommTel is complete network solutions provider, providing communications systems that manage and monitor electricity grids, train and rail support, air traffic control, mining automation, telecommunications services and emergency services to over 150 customers in Australia, New Zealand, the UK and Asia.

Andrew Knight and Sebastian Hams of KordaMentha were appointed voluntary administrators of the company on 30 August. The company’s issues were caused by factors including floods in Queensland and New South Wales that caused delays on certain projects and a backlog of factory work, several large cash consuming projects being on foot simultaneously, and a lack of working capital and funding in place to support the levels of growth and projects.

After conducting a sale process, the administrators recommended that creditors execute a DOCA proposed by GenusPlus which includes a contribution of $10.1 million, less the amount due to Commonwealth Bank of Australia (estimated to be $4.3 million), plus an acquisition of intellectual property for an earn-out of up to $7 million.

At the second meeting of creditors, creditors voted in favour of the proposal. Only a “small number of redundancies” are expected, and completion is anticipated by the end of 2024.

Read the administrators’ report to creditors HERE.