The Red Lea Group has gone into voluntary administration but its franchisee network of 22 stores is continuing to trade.

Red Lea distributed fresh and cooked chicken products to 28 specialty locations and supplied chicken products to supermarkets, specialty butchers, restaurants and hotels from its processing plant in Blacktown NSW.

According to the administrators the majority of staff (about 500 at the plant and the employees of the six corporate stores) have now been advised of their redundancies while a few employees will be temporarily retained to “support the orderly wind down of operations”.

McGrathNicol partners Barry Kogan, Jason Preston and Kathy Sozou have been appointed administrators.

A statement from the administrators says the franchise retailers are considering alternative chicken suppliers.

The administrators will work with key stakeholders to “ensure an orderly wind-down of operations and commence our investigation into the affairs of the Red Lea Group and the reasons for the its failure”, the statement reads.

The first creditors meeting will be held on Thursday 12 April 2018 and the second meeting of creditors in about four weeks time will determine the Group’s future.

According to the administrators, the sole director intends to submit a Deed of Company Arrangement which will cover the outstanding employee entitlements (including unpaid superannuation, wages, annual leave, long service leave, pay in lieu of notice and redundancy) in full and provide a return to unsecured creditors.

The 60-year-old business started out selling chicken door-to-door.