DOCA Effectuated: Genetic Technologies Ends Administration, Creditors’ Trust Formed
Genetic Technologies Limited has officially exited external administration following the effectuation of a Deed of Company Arrangement, marking a significant shift in its corporate governance and creditor relations.
- DOCA effectuated on 14 May 2025, ending external administration
- Existing directors resigned; control passed to incoming directors
- Creditors’ Trust established with deed administrators as trustees
- Creditors now beneficiaries of the trust, no expected unsecured creditor returns
- Company poised for a new chapter under fresh leadership
A Turning Point for Genetic Technologies
Genetic Technologies Limited (ASX: GTG), a biotechnology company, has taken a crucial step in its corporate restructuring journey by exiting external administration as of 14 May 2025. This milestone follows the effectuation of a Deed of Company Arrangement (DOCA) that was approved by creditors earlier this year and executed in March.
The DOCA’s completion signals the end of a challenging period for the company, which had been under voluntary administration since November 2024. The existing board of directors resigned effective immediately upon the DOCA’s effectuation, paving the way for new leadership to guide the company forward.
Establishing the Creditors’ Trust
Integral to the DOCA’s terms was the creation of the Genetic Technologies’ Creditors’ Trust, formalised on 7 May 2025. This trust transfers creditor claims from the company to the trust itself, with the former deed administrators, Paul Harlond and Ross Blakeley of FTI Consulting, appointed as trustees. Creditors are now beneficiaries of this trust rather than direct creditors of the company.
However, the administrators have made it clear that unsecured creditors should not expect any dividend payments. This underscores the financial challenges Genetic Technologies continues to face despite emerging from administration.
Implications for Stakeholders
The transition in control and governance marks a fresh chapter for Genetic Technologies, but the road ahead remains uncertain. The new board will need to articulate a clear strategic vision to restore confidence among investors and stakeholders. Meanwhile, creditors must navigate their new status within the Creditors’ Trust framework, awaiting any potential distributions that may or may not materialise.
Communication channels have been established for both creditors and the company’s ongoing operations, reflecting a commitment to transparency during this transitional phase.
Overall, the effectuation of the DOCA and the establishment of the Creditors’ Trust represent significant restructuring milestones. Yet, the company’s future trajectory will depend heavily on the new leadership’s ability to stabilise operations and pursue viable growth opportunities.
Bottom Line?
Genetic Technologies’ exit from administration opens a new chapter, but the path to recovery remains complex and closely watched.
Questions in the middle?
- Who are the incoming directors and what is their strategic vision?
- Will unsecured creditors receive any return from the Creditors’ Trust in the future?
- What operational changes or new initiatives will the new board implement to revive the company?