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BWA Insolvency appointed as administrator for Shanton Fashions Limited

BWA Insolvency appointed as administrator for Shanton Fashions Limited

BWA Insolvency logoMEDIA RELEASE FROM BWA INSOLVENCY LTD

The directors of Shanton Fashions Limited have placed the company into voluntary administration, with insolvency expert Bryan Williams of BWA Insolvency appointed as administrator.

The move is in response to Shanton’s credit facilities being withdrawn and demand made for immediate payment of the overdrawn balance. It is too early at this stage to identify how much is owed to creditors.

“Despite the company having its liquidity greatly reduced, the directors are still of the view that the business can continue and the brand survive. They are highly motivated to achieve this outcome, which is why they have elected voluntary administration [VA],” Williams says.

“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.”

The well-known women’s fashion chain has 37 stores across New Zealand and employs approximately 240 people.

Payment of staff wages during administration will continue and unpaid wages and holiday pay are classified as preferential. Further investigation is required before any decisions are made around restructuring.

“The clear intention is to preserve the inherent value in the brand. This is largely comprised of the product that it sells, the location of it stores and the people that design, make and sell the product,” Williams says.

In the meantime, business will be conducted as normal, except that gift vouchers and layby purchases will need to be dealt with directly through the office of the administrator.

The amount owed to creditors is expected to be made known once the director’s statement of position is handed over to the administrator – within five working days of Williams’ appointment. The statement of position will be presented to the first creditors’ meeting, required by law to be held within eight days of the commencement of VA.

ENDS

For further information, please contact:
Bryan Williams, Principal, BWA Insolvency – 0800 292 467, bryan@bwainsolvency.co.nz

About BWA Insolvency:
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.

Celia Crosbie
Written by Celia Crosbie
Celia is an award-winning former journalist who has worked for newspapers and radio stations in New Zealand and magazines in the United Kingdom. She has worked in public relations in both NZ and London. Celia also specialises in digital media strategy and website copywriting for SEO.