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Dick Smith Receiver Struggles To Flog Assets As So Called “Sale” Flops

Dick Smith Receiver Struggles To Flog Assets As So Called “Sale” Flops

The National Australia Bank and HSBC who knocked back a $70M conditional offer for Dick Smith are struggling to sell remaining assets after Harvey Norman is believed to have walked away from buying the airport based Move Stores that were closed down late last week.

At a store level Dick Smith stores that the receivers Ferrier Hodgson claim to running a “massive” discount sale is still selling product significantly higher than JB Hi Fi.
A Bush digital radio is being sold at Dick Smith for $129 the same radio is on sale at JB Hi Fi for $128. You can also buy the same radio along with a Bush Kettle and Toaster in a breakfast kit for $129.

 

                        Dick Smith $129 Radio Vs JB Hi Fi Radio Below

 
ChannelNews understands that two major retailers have approached airport authorities in both Sydney and Melbourne with a view to taking on new leases for the Move stores. 
 
We have also been told that the receivers who is fast running out of cash to operate the Dick Smith stores will this week move to start closing down stores.
 
Sydney based Hi Fi specialist Len Wallis has made an offer to local Dick Smith staff to apply for vacant positions at his North Ryde based store.
 
At the weekend Fairfax Media reported that sources at Dick Smith approach Anchorage Capital, the Company that pocketed over $500M to help fund the struggling retailer. 
 
Nick Aboud the former CEO of Dick Smith who is currently being investigated regarding information and the lack of information supplied to shareholders was the executive who went to Anchorage Capital after the banks told Dick Smith executives that they were set to close down the Company. 
   
Anchorage is understood to be waiting for the administrator’s report and the outcome of the Senate inquiry before offering any commentary on the demise of the business. 
Close to 3000 people lost their jobs when receiver Ferrier Hodgson turned out the lights last week having failed to negotiate a sale.
 
The closure of chain’s four Move stores at Sydney International Airport on Friday, will add up to 48 staff to the unemployment queue within the next few months.
 
Losses before interest and tax blew out to $100.3 million at the chain in December on an $11 million sales slump, according to Dick Smith’s accounts exclusively obtained by ChannelNews, compared with a $2.6 million profit before interest in tax in September.
 
Fairfax Media reported that one market watcher said the banks’ decision to withdraw support for Dick Smith would be remembered as “one of the worst decisions in history because everyone has lost, including the banks”.
 
National Australia Bank and HSBC only took Dick Smith on in April, according to Dick Smith sources, and by December they had installed staff in the retailer’s head office to closely monitor its finances.
 
This week, Ferrier Hodgson put the retailers’ customer database up for sale, sparking concerns any transfer of customer information may breech privacy legislation.
 
However, a spokesman for the receivers said Ferrier Hodgson would “communicate with all customers on the database ahead of any sale” and customers would be given the opportunity to opt out of a sale.

 

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