Allco Finance, the Australian asset manager that joined forces with Texas Pacific Group and Macquarie in the failed A$11bn buy-out bid for Qantas Airways, has collapsed into receivership owing close to A$1bn.

The group had failed in its recent attempts to sell assets as it tried to restore a balance sheet devastated by a debt-fuelled acquisition spree near the top of the market.

The group’s demise, announced on Tuesday night, will fuel the debate about an era in Australia which tolerated companies with complex and opaque structures. Allco has a string of management agreements with subsidiaries and associates, a structure borrowed heavily from the model pioneered by Macquarie and Babcock & Brown, the Australian investment groups.

Both Macquarie and B&B have in recent weeks made big concessions regarding the management agreements with their listed infrastructure satellites, in an attempt to address corporate governance concerns.

Allco last month warned its future was fragile when it said it was in danger of missing scheduled debt repayments. It owed about A$667m in senior debt.

Westpac and Commonwealth Bank of Australia are believed to be owed more than A$400m between them.

The group will go down as one of Australia’s biggest casualties of the global credit crisis. However, a number of other groups, including Centro Properties, owner of shopping malls in Australia and the US, is also at the mercy of its banks.

Meanwhile, B&B is refashioning its business, has lost its senior management team, and is attempting to pay down debt. Its shares have fallen by more than 90 per cent as market investors lost faith in groups that were deemed too reliant on cheap debt and rising asset values.

Allco in August reported a A$1.74bn net loss for the year to June 30, one of the largest in Australian history, after it took impairment charges on investments of A$1.43bn.

The group had been attempting a radical overhaul to trade it way out of its difficulties. It had ceased principal investments and intended to focus on its aviation, shipping and private equity operations.

Its shares have been suspended since Monday pending an announcement relating to its banking syndicate. It said in a statement on Tuesday night that after a ”careful review” of its future, it had called in McGrathNicol as voluntary administrator. Its banking syndicate soon after appointed Ferrier Hodgson as receivers.

Ferrier Hodgson aims to maximise the return on Allco’s available assets but the receivership is expected to take several years to complete.