Chicken franchisor Red Lea Group has fallen into administration, putting the jobs of hundreds of employees at risk.

The business, which oversees 28 franchised chicken stores across the country, is progressing an “orderly wind down” of operations under the stewardship of McGrathNicol partners Barry Kogan, Jason Preston and Kathy Sozou.

The franchised stores will continue trading but have been forced to look for alternative chicken suppliers.

“Due to the financial position of the companies, we regret to advise that the administrators are unable to trade the business and have no alternative other than to undertake an orderly wind-down of operations,” a statement on the company’s website read.

The business operated a chicken processing plant in Blacktown that employed 500 people, the majority of whom have been advised of their redundancies.

“The immediate focus of the administration is to 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,” administrators said in a statement.

A first creditors meeting will be held on 12 April, while a second meeting to determine the future of the group will be held in approximately one month.

A deed of company arrangement that would see the business salvaged is on the table, with the sole director of the business having already advised that he intends to submit a deed that would cover outstanding employee entitlements and some type of return to unsecured creditors.

The company’s Facebook and Instagram accounts have already been suspended, while calls to the company rang out on Wednesday morning.

The 60-year-old business started out selling chicken door-to-door but over the years has expanded a dedicated retail network run through franchisees.

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