news The administrator for Dick Smith Holdings has announced that it will shut down all the troubled retailer’s outlets within David Jones department stores, leaving over 180 employees facing an uncertain future.
Ferrier Hodgson, receiving company for the group, said that a total of 27 ‘David Jones Electronics Powered by Dick Smith’ stores across Australia are to close.
The receiving firm said it had been conducting an ongoing review of the operations of the group with “a view to maintaining stable operations in order to facilitate its sale as an ongoing concern”.
As a result of this review, it has determined that operations of the 27 stores will cease, with the relationship between Dick Smith and David Jones coming to an end at the close of business on Wednesday, 27 January 2016. The terms of the termination have been mutually agreed between the parties, the firm added.
The closures will will affect the employment of 181 employees, including two full-time employees, 78 part-time employees and 101 casual employees.
Ferrier Hodgson said the group is working to “identify opportunities for future employment for as many of the affected staff as possible through the Dick Smith network”.
The receiver stressed that the closure of the stores is a “necessary step” that will help ensure the commercial viability of the Dick Smith Group businesses.
Dick Smith went into receivership early in January, saying it had become “cash constrained”, and that it would be business as usual while the administrator looked at restructuring and realisation opportunities for the group.
Soon after, on 12 January, Nick Abboud, CEO of Dick Smith tendered his resignation leaving Don Grover as interim CEO. Grover will assist the receivers going forwards.
Ferrier Hodgson has launched advertisements online and across publications in Australia and New Zealand to seek expressions of interest for the sale of the Dick Smith and Move businesses.
These advertisements, the firm said, “come on the back of over 40 initial expressions of interest from various parties prior to the commencement of the advertising campaign”.
The Dick Smith group operates 393 stores across Australia and New Zealand under four brands: Dick Smith, Electronics powered by Dick Smith, Move and Move by Dick Smith. The company currently has secured creditors and unsecured creditors who are owed around $140m and $250m, respectively.