Author: Mark Fletcher

Bill Express related entity Technology Business International Pty Ltd (TBI) has appointed a liquidator. TBI is the company newsagents signed leases with for the Bill Express equipment. The only resolution put to the extraordinary general meeting of TBI was:

That as the company is unable to pay its debts as and when they call due, the company be wound up voluntarily and that Geoffrey Neils Handberg be appointed Liquidator for the purpose of such winding up.

The meeting was attended by Sandro DiDonato as proxy for Technology Business Holdings Pty Ltd (TBH), the sole shareholder in TBI. TBH has four shareholders with 96.5% of the business being owned by Equip Rentals Pty Ltd (ER). ER has one shareholder – Sandro DiDonato and was deregistered in December 2007.

Bill Express accounts for June 20, 2007 listed TBI and Technology Business Systems Pty Ltd (TBS) as owing $22.8 million to Bill Express. The imminent liquidation of TBI would appear to reduce the assets of Bill Express by $22.8 million – unless it has been part or full repaid between June 3, 2007 and June 30, 2008.

The minutes for the extraordinary general meeting of TBI were originally dated June 26, 2008. This was amended by hand to June 30, 2008. While I am not sure about the significance of such a change, I wonder in the minutes were prepared in advance of the meeting and if so, how far in advance.

Not all newsagents are being informed equally about matters relating to Bill Express. For example, the QNF published the following questions and answers to their members last week – following a meeting they organised on the Bill Express matter. I reproduce the QNF questions/comments here with permission of the QNF:

1. If it (legal action) is unsuccessful will we still have to pay the rental charge? If the legal case is not successful you will then have to start paying your $495 for the life of the contract, just like any other contract that you enter into.
2. Bill Express recently promised relief to Regional Newsagents . This appears to be a sales pitch which may have been genuine at the time. Perhaps it was to delay newsagents’ taking action.
3. Some newsagents were told by Bill Express representatives that BXP never intended to keep the subsidies……. Hank Spier (Barrister who attended the QNF meeting and former General Manager of the ACCC) stated that if there is any evidence out there that can prove this then this would be very valuable. This may only be known once the court case commences and records are subpoenaed. Did any other involved parties know about this?
4. The rebates were the integral reason why newsagents first entered into the contract. Newsagents were mislead.
5. Once you have suspended/cancelled direct debit that should be it. You are the Bank’s customer and they should honor what you require them to do. Be mindful not to cancel your ‘dial time’ direct debit until the end of month you last used it.  The ANZ Bank will still have to charge you merchant fees if you have used your machine during that month.  Approximately 2 weeks before you are finished with your Dial Time machine you must write and request that Bill Express send a “Request for Closure Form” to the ANZ bank to make sure they stop charging you, as at a certain date, for use of their machine. (Keep a copy) 
6. You can terminate your BXP contract by giving 180 days notice but you cannot terminate your Finance contract prematurely.  This may change with the result of court proceedings. If you are close to the end of your BXP contract and are not intending to renew it you must write to BXP and TBI to give 180 days notice.   (Renewal of your BXP contract does not mean you will enter into another finance contract.  Once you have paid off your finance contract it is finished.  BXP will give you a new contract to sign with new terms and conditions but no finance contract.)
7. A newsagent at the meeting stated that once a direct debit goes through your account you have 48 hours to request the money back. Your own bank should be able to do this on request.
8. Who is responsible if customer pays a Bill Express account and it does not reach its destination? For example an Origin Energy payment. Your customer will have a receipt to prove payment was made. You should have a corresponding debit from your account. If they pay by cheque then in our example Origin, the account that it was deposited into would be known by the Bank. These payments are also underwritten.
9. If you cancel your contract all equipment belongs to BXP. You are only renting. Newsagents must return all equipment back to BXP. It is up to you to keep the equipment in a safe place until/if BXP come to collect it.

Bill Express offered a slither of clarity to the market with an announcement to the ASX late today:

• The standstill agreement with financiers and key suppliers had been executed.
• Four Directors have resigned.
• The company’s CFO (who joined the company late last year) has been appointed a Director.
• The company is proceeding in its discussion with the Al Othman Group about restructuring and recapitalisation.
• The company is not proceeding with the previously announced APN/ETT transaction.

Coincidentally, ETT today sought suspension from the ASX as it seeks to resolve a commercial dispute with IPStar. Bill Express owns 43% of the shares in ETT.

I’d expect the discussions with Al Othman to proceed at speed given that they are already significant shareholders in Bill Express and licencees of its technology overseas.

Bill Express has made no statement about the reported Federal Police investigation into its affairs. Nor is there any update on its deal with Swish Group about managing its retail screen network or the advice the company has received that it would be a respondent in proposed Class Action by newsagents.

I would expect Bill Express to now seek to mend its relationship with newsagents. I’d expect the company to seek to do this through a third party. Work has been done on this over the last two months with several prospective “partners” since the end of the commercial agreement with the ANF.

The ANF confirmed today that it has 176 expressions of interest from newsagents to support its proposed legal action against Bill Express. My understanding is that more than double this number is supporting the more advanced Federal Court action originally commenced out of NSW.

I and some colleagues have been doing some research into Technology Business International Pty Ltd (TBI), the company through which newsagents signed lease agreements with for the Bill Express equipment.

• TBI is owned by Technology Business Holdings Pty Ltd (TBH) and has two Directors, one of whom is Sandro DiDonato.
• Technology Business Systems Pty Ltd (TBS) is owned by TBH and has one Director, Sandro DiDonato.
• TBH has four shareholders, the largest (96.5% of issued capital) being Equip Rentals Pty Ltd and one Director, Sandro DiDonato.
• Equip Rentals Pty Ltd was deregistered on 9 December, 2007. It had one shareholder, Sandro DiDonato and two directors, one of whom was Sandro DiDonato.

It would appear from letters received by newsagents recently that TBI has moved from the Bill Express Eaglemont Head Office to Helen Street in West Heidelberg. It has been suggested that this move coincides with the move of treasury functions to the Helen Street address. This is the address used for Australian Private Networks.

• APN is primarily owned (95.5% of issued capital) by Telecards Asia Pty Ltd and has one director, Sandro DiDonato.
• Telecards Asia Pty Ltd is owned by Sandro DiDonato and has one director, Sandro DiDonato.

In their February 29 announcement of half yearly results, Bill Express announced that it would acquire a controlling stake in APN.  The announcement talked up the Activ8me business.  The due diligence for the purchase was expected to be completed in the first week of March.  The company has not made an announcement regarding APN since.  There is a question as to whether Bill Express should have disclosed that this is a related party transaction.  While I am not saying it was, if I were a shareholder in Bill Express I would want the question asked.

I would like to know more about the reported visit to Bill Express headquarters by the Federal Police and what their visit relates to.

There are many questions which come to mind as I go through the tangled web of companies:

• Questions about APN and its financial and otherwise relationship to Bill Express.
• Questions about ETT, a public company linked to the Bill Express / OnQ group.
• Questions about OnQ itself and its tangled relationship with Bill Express and associated companies.
• Questions about the legal battle between OnQ shareholders.
• Questions about where the intellectual property which is at the heart of the Bill Express proposition is actually held.

These and other questions go to the heart of the viability of Bill Express, a matter of great interest to newsagents.