Four months after administrators were called in to try and save troubled retailer Oroton Group, it looks as if a buyer has been found to keep the business afloat.
Administrators Vaughan Strawbridge and Glen Kanevsky of Deloitte Restructuring Services issued a statement that said they have recommended creditors of the fashion chain to accept a proposal by an unnamed entity controlled by a Mr J Will Vicars.
Fairfax Media linked Mr Vicars to global investment firm Caledonia, which it said is a major shareholder of Oroton.
Under the deal, which is subject to a creditors’ vote on 29 March, Oroton Group would be fully acquired and continue trading, with its roughly 350 staff retaining their jobs and full entitlements.
Unsecured creditors, however, would only receive between 36 and 58 cents in the dollar of what they are owed.
“This has been a complex and high-profile appointment. In the interests of creditors, our focus has been on maintaining as much of the group’s operations as possible, including across its extensive retail network,” said Mr Strawbridge.
“The Vicars proposal is superior to other offers received, and ensures the best possible return for creditors via a recapitalised business that will provide ongoing roles for employees, and continuing relationships with this iconic Australian brand for suppliers, landlords and other stakeholders.”
Mr Strawbridge added: “If the DOCA is approved by creditors, we then expect the court process will take up to two months to complete. And if approved by creditors and court, the process will ensure a strong and stable future for this great Australian brand.”
Oroton Group went into administration in late November 2017, amid falling sales and a $5.4 million debt. The listed business closed its other brand Gap, while Oroton stores have continued to trade.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.