MMT launches legal action against Optima's retail business

Proceedings come as speculation mounts around company's trading halt

Victoria-based distributor, Multimedia Technology (MMT) has launched legal proceedings against Optima's retail subsidiary, Digital City, to recover hundreds of thousands of dollars in debt. The news comes as industry speculation mounts about the future of the ASX-listed PC assembler, Optima (ASX: OPI), after it called a trading halt on Friday.

According to a statement posted to the ASX, shares in Optima will "remain pre-open" until an announcement is made on Tuesday, July 22, or trading re-commences.

MMT managing director, John Hassall, said the distributor had not been dealing directly with Optima but confirmed it launched legal action against Digital City last week through the county courts for failure to pay bills between March and June 2008. The debt is several hundred thousand dollars.

Digital City, a CE retail chain with shopfronts in Sydney and Canberra, was acquired by Optima in October last year after administrators were called in. According to MMT, the company's head office has been procuring goods on behalf of all stores but several calls made by the distributor to Digital City's financial controller, as well as Optima's chairman and managing director, Cornel Ung, had not been returned at time of press.

ARN has been flooded with calls from industry representatives wanting to know more about Optima's situation, with some expressing concern about the company's future.

According to a source close to Optima, eight staff were made redundant in recent months, bringing its headcount down to about 100.

Optima's shares have been trading at $0.015 for the past two weeks. The company has consistently lost value during 2008, falling from $0.06 in January.

The Australian PC assembler has been confronted with challenges at every turn over several years as it struggles to compete against the multinational PC vendors for both state and federal government procurement contracts.

In its half-yearly accounts to December 31, the company reported a $5.1 million net loss including tax expenses of $2.8 million and impairment costs of $340,000, brought about by its acquisition of Digital City. Optima's operational loss totalled $2 million over the six-month period, while revenue was down 37 per cent to $26.2 million.

At the time, Ung said it had reduced its headcount by 13 per cent in December, mostly across education account management, to cut operational costs.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.
Nadia Cameron
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Featured Content

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?