EXCLUSIVE:Now Spotlight Owned Harris Scarfe Tries To “Screw” Suppliers
Back in April, department store chain Harris Scarfe was sold to Spotlight Group, leaving unsecured creditors in the lurch for millions, now the new owner is trying to “screw” current suppliers by demanding price reductions that had been agreed by the administrator, or they won’t get paid on time.
According to several suppliers who have contacted ChannelNews Spotlight Group Holding told suppliers this week that they want a further 7.5% discount off the already agreed price with some suppliers now being told that they won’t be paid on time if they don’t agree to the proposed discounts.
“All we want are payment with the agreed terms, now Spotlight buyers are simply trying to “screw” us said one very angry supplier.
Rich-listers Zac Fried and his uncle Morry Fraid who is worth over $1Billion own Spotlight Group Holding have not said how much they expect to extract from suppliers who are already struggling due to COVID-19.
Under a deed of company arrangement, unsecured creditors owed between $146 million and $236 million have been told that they will receive between 1.3¢ and 20.5¢ in the dollar, with landlords set to get only 4¢ in the dollar.
But Allegro Funds who acquired the retailer from questionable South African owned Company Greenlit Brands is set to pocket the $70M that was in the Harris Farm bank account when they went broke despite only owning the business for days before calling in the administrators.
“First it was a corrupt South African linked Company, then we had an investment Company with no scruples who pocketed $70 million that should have gone to creditors now we have a retailer who wants to extract their pound of flesh from suppliers despite the fact that Spotlight owners are multi-millionaires”.
“What a bunch of bastards” said one angry creditor.
Spotlight got hold of the failed Harris Scarfe after a deed of company arrangement (DOCA) was agreed upon by creditors which would result in Harris Scarfe continuing to trade under the ownership of Spotlight Group, the parent company of craft retailer Spotlight and outdoor goods chain Anaconda.
“The insolvency of Harris Scarfe has resulted in unsecured creditors losing money, an outcome which is obviously upsetting,” says administrator BDO.
Harris Scarfe fell into administration in December 2019 despite its leading customer satisfaction rating and annual sales of $380 million.
Spotlight Group was granted exclusivity to acquire Harris Scarfe in early March after a due diligence process that saw four parties shortlisted and given access to the trading records of the business.
When Harris Scarfe fell into administration more than 450 staff were let go as 21 stores were closed nationally.
Neither Spotlight nor their P Company have so far responded to our questions regarding their demands for further discounts from suppliers.