Dick Smith’s creditors have placed the company in to liquidation.
But the shareholders and unsecured creditors are unlikely to get their money back.
McGrathNicol, administrators of the failed electronic retailer, say the banks will get something, but there’s little prospect of anything for unsecured creditors including shareholders and those with Dick Smith gift cards.
The collapse of Dick Smith is likely to mean a shortfall to creditors of more than $260 million, according to a report by McGrathNicol released earlier this month.
“Creditors resolved at the meetings to appoint Joseph Hayes and Jason Preston (McGrathNicol partners) as liquidators,” McGrathNicol said in a statement after the second meeting of creditors in Sydney today.
McGrathNicol says Dick Smith failed because the company was carrying too much stock it couldn’t sell and did not have enough cash to fund rapid expansion.
The NAB and HSBC are believed to be owed $140 million. The banks will be repaid a proportion of what they are owed, but are likely to suffer a “significant shortfall”.
The only part of Dick Smith still operating is an online store now owned by Ruslan Kogan’s ASX-listed Kogan.com.
Administrators were appointed on January 4 and the last day of trading was May 3.