The Australian-headquartered merchanting group has breached its terms with invoice financier ING, which has given it until 15 April to sell its Benelux operations.
In a statement explaining its request for the share suspension extension to the Australian Stock Exchange, Paperlinx stated: “The company is still assessing the impact of the UK administration on other Paperlinx operations, given the interconnectedness of financing arrangements and the supply chain in the region.”
The firm had previously said that a sale process was underway for its Benelux business, although it had not received any binding offers.
Today’s update said: “The company is not currently expected to receive any direct material benefit from a sale or realisation of Benelux or any other European business. However, the proceeds of a sale or realisation are expected to benefit other European stakeholders.”
The suspension will be effective until the start of trading on Thursday 16 April, or until the firm makes a further announcement.
Paperlinx operates across 11 European countries: Austria, Belgium, Czech Republic, Denmark, Germany, Ireland, Poland, Spain, Sweden, the Netherlands and the UK.
Its UK packaging business is not in administration and continues to trade normally.
The loss-making European operations were by far Paperlinx’s biggest business segment, accounting for A$2bn (£1bn) of total group sales of A$2.8bn last year.
EBITDA losses in Europe, while significantly reduced, were still running at more than A$1m a month in 2014.
There has been no official update from administrators at Deloitte about any possible sale of the UK operations that were put into administration last week, or regarding the packaging business that is also potentially for sale.
A spokesman confirmed that the UK businesses trading in administration were not just running down existing stocks, and could buy in additional products if manufacturers were willing to supply the business.
“We will continue to consider additional stock purchases on a case-by-case basis, where appropriate,” he said.
However, all goods delivered from 1 April are now subject to 30 days payment terms, described by one printer as “not that attractive”.
Edit note: the EBITDA figure in the original version of this story referred to the entire group, not Europe alone.
