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Kriedemann Farms being held to Ransom by Suncorp Bank

Alberton farmer Barry Kriedemann says he has lost some $20 million in capital, land and other assets following the collapse of his sugar cane mulch business. Alberton farmer Barry Kriedemann says he has lost some $20 million in capital, land and other assets following the collapse of his sugar cane mulch business.
“They have said that if I refuse to sign and I take them to court as I have suggested, they will take proceedings against me to chew up the remaining funds.”

“But it seems nothing can be done to stop them.”

Mr Kriedemann said the Kriedemann Farms business and its owner B&G Kriedemann no longer had any outstanding debts. He is now seeking $1.2m in cash and 80ha of unsold land, which he says is still in the control of the receivers.

“Now they are demanding I sign documents to release them from any responsibility or liability before they will release that money,” Mr Kriedemann said.

BARRY Kriedemann is living in hell. Every minute of every day he endures the nightmare of losing almost $20 million in capital, land and other assets following the collapse of his sugar cane mulch business based on his farm at Alberton, between Brisbane and the Gold Coast.

That collapse started three years ago when the Coles-owned hardware giant Bunnings Warehouse advised it was no longer willing to do business with Kriedemann Farms.

The reason was that Kriedemann Farms was not able or willing to absorb the cost of the massive freight bill to transport 350,000 17kg bags of sugar cane mulch to 150 Bunnings stores across Australia, Mr Kriedemann said.

“They wanted to sell it for the same price in all their stores but we would have to pay the freight,” Mr Kriedemann said.

“The freight to Brisbane worked out at about $1/bag, to Sydney about $2.40 and to Melbourne about $3.50.

“We told Bunnings that we could not stay in business if we had to absorb that cost. Bunnings’ response was to write a letter saying they were no longer willing to do business with us.

“One Bunnings representative even told us we had not kept up with the times and I had not earned any right to be in business. We had invested millions of dollars.

“If it wasn’t for me and what I did, they wouldn’t have a sugar cane mulch business.”

Mr Kriedemann said the 17kg bags had been sold for $8/bag ex-Alberton and he worked on making $1/bag profit.

The unprocessed cane trash cost $3.30 for 17kg and the printed plastic bag cost 80c.

Wages, administration, grinding costs and bagging accounted for the other $2.90/bag, he said.

“Bunnings had been selling the same 17kg bag of mulch for about $13. As far as I could see they were certainly making a good profit on every bag.”

Mr Kriedemann said at about the same time a competitor emerged from the Childers region that gave Bunnings an alternative source of supply.

That competitor had secured a grant of land and $1.5m in government funding allowing them to undercut the market, he said.

With Kriedemann Farms’ $7m cash flow all but gone, the business was faced with the reality of sacking 33 staff.

It was then that Mr Kriedemann and his brother and business partner Graeme acted on advice and appointed a receiver to “sort out the business”.

Mr Kriedemann said despite the business being under the control of the insolvency group then known as Aggs Robson (now Robson Cotter) and subsequently by Ernst and Young at the request of Suncorp Bank, he was led to believe he would still have a strong say in how the business could be restructured.

He said the ruthlessness of the process employed by the receivers and the bank was demonstrated when assets began to be significantly reduced in value.

One example was the business’s machinery which was sold for $607,000.

“It was hauled to Brisbane and auctioned without even a reserve price even though GraysOnline had valued it prior to the auction at $900,000,” he said.

“There was no attempt made to get the real value of the machinery. They just took whatever was offered.”

Some 163ha of highly productive cane land was also put to auction and sold at “a third of its real value”.

Some 120ha of land with industrial sheds with replacement cost of $4.5m were sold for $3.2m.

“They had no right to devalue the assets the way they have done it,” Mr Kriedemann said.

“But it seems nothing can be done to stop them.”

Mr Kriedemann said the Kriedemann Farms business and its owner B&G Kriedemann no longer had any outstanding debts. He is now seeking $1.2m in cash and 80ha of unsold land, which he says is still in the control of the receivers.

“Now they are demanding I sign documents to release them from any responsibility or liability before they will release that money,” Mr Kriedemann said.

“They have said that if I refuse to sign and I take them to court as I have suggested, they will take proceedings against me to chew up the remaining funds.”

Ambitions turned to dust

KRIEDEMANN Farms began producing sugar cane mulch some 20 years ago when Barry Kriedemann decided to spread decomposing cane trash on his wife Lee’s garden.

“She was horrified when she first saw it and made it known she didn’t want that rough looking stuff around her plants,” Mr Kriedemann said.

“She raked up it up immediately and put it in garbage bags.”

But it did not stop an inspired Mr Kriedemann who ran the trash through a hammer mill to chop it to an even length to improve its visual appeal.

More importantly Mrs Kriedemann was very happy with the look of the mulch and particularly how it performed on her garden beds.

But it was after friends and visitors to the Kriedemann’s home began to ask where they could buy the attractive mulch that Mr Kriedemann actively began to develop a market.

Samples were produced and presented to retail nurseries in South East Queensland that recognised there was a ready market for the product.

Mr Kriedemann said Bunnings approached Kriedemann Farms to supply the bagged product to seven of its stores in South East Queensland.

Kriedemann Farms grew into a business with a turnover of $7 million a year employing 33 people, eventually supplying 150 Bunnings stores.

The loss has come with a heavy toll for the 60-year-old farmer.

“Every day I am living a horror story,” Mr Kriedemann said.

“I walk in the hills behind Ormeau. I also cry.

“I left school at 15. I just couldn’t wait to get out. All I wanted to do was be a farmer.”

The Kriedemanns are one of the original pioneer families of the Gold Coast hinterland. They settled on the Albert River in the 1860s.

 This Story first appeared in Queensland Country Life written by Mark Phelps
Adam Sanders Bank Victims
Last modified onSaturday, 20 September 2014 02:31

2 comments

  • Barry Kriedemann
    Barry Kriedemann Sunday, 10 April 2016 22:56 Comment Link

    Since then I have found where Suncorp Met way Pty Ltd had stolen $4i15 ,000. from our bank account to the top of the owed to .
    Also The Banks receiver also Ernst & Young have talking false amount of money with false invoices for further amount of $438,000.00 to equal amount of $853,000.00 of stolen from Kriedemann Farms .
    They have asked in a settlement Deed that I am to with draw my complaint from the Financial Ombudsman Services that I Had forwarded a complaint .too .
    N o money has been fought coming.
    Just hell to Ransom by the false claims .
    Total amount = $853,000.00 + the $1,200,000.. =
    A total amount of $2,,053,00. has been taking beside what was owed to them ..
    Signed B W Kriedemann . 8/04/2016.

    Report
  • Evan Jones
    Evan Jones Monday, 22 September 2014 07:43 Comment Link

    Congratulations to QCL for publishing this account. You wouldn't see an article like this in The Land, which has failed farmers utterly in this regard.
    There doesn't appear to be a single bank in Australia that isn't steeped in corruption in its treatment of farmer & SME borrowers.
    It's a no-brainer really. It would be easier, and more profitable to do the right thing. If a single bank chose to operate with integrity in this domain it would soon come to dominate business in these segments.
    And again, where are the Queensland National Party reps, State and federal? Don't vote - an opportunist always wins.

    Report

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