Creditors of women’s clothing chain, Shanton Fashions, are owed almost $7.8 million, while the business is being advertised for sale in an attempt preserve the brand’s inherent value and make a distribution to creditors.
According to the administrator’s report, released to creditors by administrator, Bryan Williams, of BWA Insolvency, creditors’ claims amount to $7.79 million, while total assets – including stock and fixed assets at book value – total $3.35 million.
The deficiency of $4.4 million is “significantly different” to the company directors’ estimate of $693,000, as provided in their report to Williams at the commencement of voluntary administration last month.
The total number of creditors is 206, including the IRD and outstanding holiday pay owed to Shanton employees. Shanton has 155 employees across 37 stores nationwide.
“Both BWA Insolvency and the staff of Shanton are working diligently to maintain operations so that a buyer can continue the business in a manner that they see fit,” said Williams.
“In the end it is up to the secured creditors to decide that outcome and that is out of my hands. My job is to ascertain whether or not the business can continue in existence and I think we have determined that positively.”
The business was first advertised for sale on January 30. Nine expressions of interest have been received so far, with a closing deadline of February 24 for all bids.
The watershed meeting, required by law, is set down for February 16, but Williams has recommended adjourning the meeting till March 30.
“The reason for my opinion is that a business sale process is in progress and should be allowed to run its course. There are nine parties that have shown genuine interest and the determination of that interest should be fully explored,” Williams said.