Shanton Fashions Limited owes almost $4 million
MEDIA RELEASE FROM BWA INSOLVENCY
JANUARY 21, 2015. FOR IMMEDIATE RELEASE
Shanton Fashions Limited owes almost $4 million, according to BWA Insolvency
Almost $4 million is owed to about 220 unsecured creditors of Shanton Fashions Limited, but administrator Bryan Williams of BWA Insolvency is confident Shanton can and will continue to trade.
About 80 people attended the first creditors meeting in Auckland today, where Williams assured preferential creditors the IRD and Shanton employees that they will be paid outstanding entitlements.
The company directors’ statement of position tabled today showed $3,915,671 owing to unsecured creditors. The stated deficiency is $693,159, but this is relying on the market value of the assets being the same as book value, so is anticipated to be greater as the administration investigations continue.
During the meeting, Williams was resoundingly affirmed as administrator, supported by 98% of all creditors entitled to vote and who did vote. Creditors must formalise the process of the company being put into voluntary administration. There were 35 registered voters in attendance today, six offshore creditors were represented by proxy and 138 postal vostes were provided to Williams in advance of the meeting.
“That affirmation is a wonderful result and indicative of a high level of trust and confidence in myself and in BWA Insolvency,” Williams says.
Creditors largely supported Williams’ submission that viability is key to the plan for business and that he intends to consider and formalise reconstruction plans immediately on the back of this mandate. These plans will eventually be made known over time. The well-known women’s fashion chain has 37 stores across New Zealand and employs approximately 240 people.
“We can report that customers of Shanton continue to support the brand, with sales activity continuing to rise,” Williams adds.
A committee of creditors has been formed comprising industry participants and marketing contributors.
BWA Insolvency is a leading Auckland-based, but nationally-operating, insolvency practice. Led by its Principal, Bryan Williams, BWA Insolvency handles receiverships, liquidations and voluntary administrations. BWA Insolvency has been helping businesses – from small entrepreneurs to large corporates – with business issues for more than 20 years. Bryan Williams has established himself as an expert in voluntary administration. His skills have enabled businesses to recover from their insolvency issues, instead of otherwise facing liquidation.
Voluntary administration (VA) is the formal insolvency process adopted where a presumption exists that the business can continue in existence. It is the legal framework that enables the potential for a workout from difficult economic circumstances. Liquidation is terminal in the company’s life whereas VA offers hope of commercial revival brought about through the skills of the administrator to focus and harmonise all the resources of the company into a recovery plan.