'Not going anywhere': Hills Hoist hawker distances itself from Hills Limited collapse

Jul 07, 2023

The appointment of administrators to ASX-listed Hills Limited last week has spurred the current owner of the clothesline brand to distance itself from the embattled tech company and reassure customers that they will not be affected by the unrelated firm's collapse.

Hills Home Living, the current proprietor of the iconic South Australian-founded brand famous for its four-pronged backyard washing line, has issued a short statement on its website declaring its distance from Hills Limited which appointed Hall Chadwick Chartered Accountants last Friday as joint and several administrators.

Hills Homes Living is a brand that sits in a portfolio of Australian names owned by AMES Australasia and the company put out a statement after the media reports that the South Aussie invention is "not going anywhere".

"Recent news articles claiming that Hills has gone into administration relate to Hills Limited, a completely different organisation that has not been involved with Hills clotheslines (including the Hoist) for many years," the website states.

"Hills Home Living products, their availability, their warranty, and customers of our iconic brand will not be affected at all by this unrelated organisation going into administration."

It follows media reports declaring that the "company behind the iconic Hills Hoist clothesline" had gone under. Though it is technically true that Hills Limited (ASX: HIL) is the firm once responsible for the Hoist, the group that went into administration hardly bares any resemblance to the company founded in 1945 by Adelaide's Lance Leonard Hill.

The report in "The Australian" that caused confusion.

Hills Limited was primarily a tech company prior to the appointment of administrators last week and provided health-tech solutions like nurse-call systems to hospitals and tech management services to business clients.

Since 2017, the Hills brand most Australians would recognise has been owned by an entirely separate entity – AMES – which also owns manufacturers like pottery purveyors Northcote, garden tools maker Cyclone, hose company Nylex and more.

AMES – a subsidiary of New York-based Griffon Corporation – is helmed by CEO Simon Hupfeld who said he was "proud to advise that there are more Hills clotheslines being sold today than at any other time in the brand's iconic history".

"The organisation mentioned in the article, "Hills Limited," transformed into a technology company many years ago and is no longer connected to the Hills clothesline business. The articles’ use of Hills Hoist imagery alongside the news is misleading, as it incorrectly suggests a potential impact on our Hills clotheslines business, which is not the case," Hupfeld said.

"We would like to reassure our customers that the supply of Hills clotheslines and laundry products, consumer warranties, customer service, and all related aspects remain entirely unaffected by the current situation involving Hills Limited. Our commitment to delivering innovative, high-quality products and exceptional service remains unwavering."

The demise of Hills Limited has been a long-time coming, with the final nail in the coffin for the clothes dryer turned tech firm being a judgment against it to the tune of around $5.5 million.

Announced in late-May, the Court of Appeal found in favour of Stellar Vision Operations in a case relating to the provision of patient entertainment systems to the Western Sydney Local Health District.

Soon after revealing the quantum of damages it would have to pay Stellar, Hills Limited voluntarily requested its shares be suspended noting settlement negotiations with the successful party were ongoing.

Four days later, HIL appointed administrators which put a lid on a brutal downward spiral that's been ongoing since 2007.

Shares in the company traded at just 2.3 cents before the suspension was invoked, a far cry from the $6.25 per share it commanded in the mid-2000s.

Deterioration of Hills’ shares can be attributed to leadership turmoil and mounting losses to its failed tech pivot – perhaps even its decision to exit its last SA manufacturing plant in 2019 – however the company's CEO David Clarke told The Australian that appointing administrators was "not an outcome [he] ever envisaged".

"To have the company enter administration as a result of a historic legal action over a transaction that long predates the current management and board, and has never had any bearing on the operations of the business, is incredibly disappointing," Clarke said.

"Our consistent legal advice was that this legal claim would ultimately be resolved in Hills’ favour, which made the Court of Appeal ruling so unexpected.

"The board and management have worked tirelessly through the standstill period in an attempt to negotiate a commercial outcome with Stellar Vision that would protect the interests of all Hills shareholders, employees and other stakeholders. However, we have been unable to reach agreement that satisfied the requirements of all stakeholders."

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It also follows a $4.4 million capital injection secured by Hills in March from cornerstone investor Historical Holdings – a company associated with West Australian businessman Ian Trahar who also owns electrical products wholesaler Arlex Australia. Those funds were earmarked for recapitalising Hills and accelerating growth pathways in a bid for profitability.

Just over two months later, the two non-executive directors appointed as part of the Historical Holdings investment, Harley Whitcombe and Gunalan Jegnathan, resigned.

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