Listed retailer Oroton Group announced to the ASX this morning that the company has been placed in voluntary administration.
“The Strategic Review process has failed to secure a viable option for the Company and an Administrator has been appointed,” Oroton said.
The company said the closure of its Gap retail stores is on track to be completed by January 2018.
The announcement caps a difficult year for Oroton, which announced a series of earnings downgrades and saw the departure of its CEO in April.
“We have made every effort to avoid taking this decision but have been unable to source a viable solution which could achieve a better outcome than voluntary administration. The Board is disappointed that it has had to take this step after running such a comprehensive process,” interim CEO Ross Lane said.
Oroton is the latest in a long line of Australian retailers to go into administration, as the industry faces challenging conditions.
Earlier this year, fashion labels Marcs and David Lawrence went in to voluntary administration. That followed the closures last year of Payless Shoes, Pumkin Patch, Howards Storage World and Dick Smith stores.
The appointed adminsitrator, Vaughan Strawbridge, said it would continue to operate the business as it seeks to either recapitalise or sell the company.
“The flexibility of the voluntary administration process enhances the ability to further restructure Oroton Group in a manner which makes it possible to achieve the best possible outcome in these circumstances. Our ambition is that a stronger Oroton business will emerge from this process,” Vaughan Strawbridge said.
“The Administrator has advised the Company’s AGM planned for the 1st December 2017 will not proceed as scheduled, but will be deferred to a date to be advised. There will be a first meeting of creditors on Monday 11th December 2017,” Oroton said in its ASX announcement
Oroton shares have fallen over the last 12 months from a high above $2.35 to around 40 cents.