Following the collapse of Sydney-based tech retailer Mwave, which entered administration burdened with debts exceeding $18 million, distributor Dicker Data has called for the appointment of alternate administrators. The move raises concerns about the timing and transparency of the retailer’s sale to DigiDirect.

At a recent creditor meeting, Dicker Data nominated Andrew McCabe and Chris Johnson of Wexted Advisors as replacement administrators.

Their proposal followed scrutiny of the pre-administration sale of Mwave’s business and assets to DigiDirect, completed just one day before the current administrators were formally appointed.

While ChannelNews did not challenge DigiDirect’s acquisition itself, questions emerged over actions taken by Mwave’s previous management in the lead-up to its collapse.
Daniel Turk, representing Dicker Data, raised multiple concerns including:

– The adequacy of stocktakes prior to administration.
– Whether secured stock was being managed appropriately by the current administrators.

– The steep fees proposed by appointed distributor Esel Pty Ltd, reportedly ranging between $250,000 and $350,000.

David Spencer, acting as proxy for Screen Mounts Australia, opposed the replacement, describing it as a “monumental waste of money” and questioned the practical benefits for creditors.

Turk countered, asserting that replacing the administrators would ensure greater objectivity.

Mwave staff seen with Jensen Huang whose net worth is estimated by Bloomberg at US$140 billion, up $25 billion this year alone.

George Khalil, representing Ingram Micro Pty Ltd, inquired whether DigiDirect had assumed responsibility for employee entitlements.

The chairperson confirmed the process was underway, though not all payments had been completed. Further clarification revealed DigiDirect had acquired Mwave’s intellectual property, plant and equipment, along with over $1 million in employee entitlements including wages, annual leave, and long service leave.

Representatives from Auroz Pty Ltd questioned the rationale behind DigiDirect’s purchase of an insolvent business. In response, the chairperson stated the sale occurred prior to administration because Mwave lacked sufficient assets to cover its liabilities.

The administrators assured that the pre-administration sale would be thoroughly investigated and a report issued to creditors in due course.

Regarding stock security, Khalil queried whether items were quarantined in DigiDirect’s warehouse. The chairperson clarified all stock remained at Mwave’s Lidcombe warehouse and would not be moved until securities registered against the items were assessed.
Other queries at the meeting included:
– How creditors can register security on the Personal Property Securities Register (PPSR).
– Whether secured claims could extend to accounts receivable if supported by PPSR documentation.
– Whether a comprehensive stock listing would be released to creditors—currently under review by the administrators.

The Chairperson advised that no funds will be paid to the digiDirect Group by the administrators.

Instead digiDirect Group are utilising their own funds to preserve the goodwill of the Mwave brand.

Mr Chris Pittman as the proxy for Leader Computers queried the value of the debtors.

The Chairperson advised there were debtors of approximately $478,000 as at 13 June 2025.

To date, approximately $128,000 has been paid to the Company’s pre-appointment bank account, which is currently frozen.

The Chairperson also noted that there were rebates owing to the Company of approximately $686,000 which may not be recoverable due to offsets.

 

More to follow.

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