Pet food giant Bush’s International placed in receivership

Bush’s International, the pet food manufacturer and distributor founded in the late 1950s, is the latest victim of the downturn.

The large Sydney-based company, with manufacturing facilities around the country, was placed into receivership last Friday.

Bush’s is a private label supplier to the major supermarket chains. Sources say that one of the reasons for the failure is that raw material costs had increased and consumers had balked at the higher prices, turning to other brands instead.

Receivers appointed are Greg Hall and Philip Carter from PriceWaterhouseCoopers.

Majority owner, ANZ Equity Fund, took an initial investment of $20 million in September 2005, before making a ‘follow-on’ investment last July. It had also taken a $2.4 million impairment charge and there were reports that the Bush’s account is said to have been dispatched to the ‘dark side’ of the bank where workouts take place.

ANZ, which had more than 40 private equity investments, also announced last October that it had decided not to write any new private equity business.

Bush’s, which is also a private label supplier to the major supermarket chains, will remain trading while the receivers examine the financial affairs, look for a possible buyer and to offload assets.

“We have spoken to employees, key suppliers and customers and are encouraged by the response from all parties,” says Carter.

“We will continue operations as usual while we work towards selling the business as a going concern. This is a good business, it has a great workforce, loyal customers and supportive suppliers.”

But any potential purchase could attract attention from the ACCC. One retail source told SmartCompany that retailers want Bush’s to stay in business to place competitive pressure on the huge multinationals that control the pet food market.