The unfortunately-named – given what happened to Adam Osborne’s portable computer company – Australian flagship personal computer manufacturer Osborne Computer Corp of Sydney has called in a receiver. Fremont, California-based Micronics Computers Inc warns that product shipments to Osborne, which was one of its largest customers, will be substantially lower in the quarter to June […]
The unfortunately-named – given what happened to Adam Osborne’s portable computer company – Australian flagship personal computer manufacturer Osborne Computer Corp of Sydney has called in a receiver. Fremont, California-based Micronics Computers Inc warns that product shipments to Osborne, which was one of its largest customers, will be substantially lower in the quarter to June 30 compared with previous quarters. The company is in Voluntary Administration under Australian bankruptcy law, which means that it is protected from its creditors while it tries to restructure, but in Australia, the process gives no more than 90 days’ grace. Micronics has been shipping to a bonded warehouse during the quarter in hopes of finding a satisfactory resolution of the Australian’s liquidity problems, but the receivership eliminates the possibility that the product already shipped to Australia can be received by Osborne during the quarter – and this will significantly hit Micronics’ net sales for the quarter, and lead to an operating loss for the period. The main lender, Commonwealth Bank of Australia, told the Melbourne Age that the bank had appointed Tom Riddell from KPMG Peat Marwick as receiver, after Osborne’s directors appointed John Star of Sydney-based accountants Star Dean-Willcocks as an external administrator. Star told the paper the company was insolvent with debts equivalent to $30m and an unknown exposure to warranty claims. Unsecured creditors are owed between $21m and $25m, the bank is owed about $5m. The company had been reported to be under pressure after losing big supply contracts with the Federal Government and Telstra Corp, the accounts had been heavily qualified, and the Office of Fair Trading was investigating a flood of consumer complaints against the company. Osborne sold 85,000 machines last year for turnover of $178.5m, mostly into the corporate sector, and claimed 7.8% of the market, ahead of IBM Corp (which manufactures personal computers in Wangaratta, Victoria), Apple Computer Inc and Compaq Computer Corp, but a move into direct sales to the public in January seems to have sealed its downfall. The company is owned mainly by its directors, but pay television czar Albert Hadid, who was instrumental in setting up the company in 1984, has a minority stake. The failure was preceded by a crescendo of stories in the Australian press about slow, and sometimes non-delivery of computers and software made by customers that took part in special money-up-front offers from the company. The UK firm of the same name in Bristol claims to be wholly independent of the Australian. Osborne won international attention at the turn of the year as one of a band of companies that said they were so fed up with Microsoft Corp’s licensing policies that they were pre-loading IBM Corp’s PC-DOS and OS/2 Warp instead (CI No 2,585).