Shanton Fashions, which operates a chain of women's clothing stores throughout New Zealand, including Dunedin, has gone into liquidation. Dozens of jobs are likely to be threatened.
Although 18 stores are still trading this afternoon including the Dunedin store housed in the Centre City Mall, an initial report by co-liquidator Gareth Hoole says the liquidators "do not intend to continue to trade the business" and are preparing to disclaim store leases to avoid further costs to the company and its creditors.
The report does not say how many people Shanton employs. At the start of this year, 155 people worked for the company and up to 70 jobs went under a restructure in March.
Liquidation was recommended by Shanton Fashion's voluntary administrator Bryan Williams who restructured the company, closed 17 stores in March and attempted to find a buyer for the business after his appointment at the start of the year.
However, creditors - owed $7.7 million - voted against this recommendation and the company was handed back to its directors.
Those directors traded the company the best they could but its shareholders put the company into liquidation on Monday afternoon.
"The liquidators will initially seek to sell the business as a going concern but are cautious in their optimism of achieving such outcome given the evident lack of success to do so on the part of the administrator," Mr Hoole said in the report.
"It is considered that since those efforts to achieve a sale as a going concern, the value of the company and its underlying assets has dissipated further.
"Should there be no interest in the business as a going concern the liquidators will seek to realise the assets of the company piecemeal for their best potential under a forced sale scenario."
The report says the company's assets include inventory, cash at bank, shop fittings, fixtures and intellectual property, but does not disclose a value.
It lists Shanton Fashion's liabilities as totalling $7.7 million, close to the level of debt disclosed during the voluntary administration.
