Struggling online retailer appoints administrators
Struggling surfwear business Surfstitch has slipped into administration today after appointing John Park, Quentin Olde and Joseph Hansell of FTI Consulting as administrators effective immediately.
The decision only affects the non-operating Surfstitch companies, including the ASX-listed Surfstitch Group Limited and Surfstitch Holdings Pty Limited, which owns and operates the brands Surfstitch in Australia, Swell in the US and SurfDome in the UK.
The brands themselves are unaffected and will continue to trade as normal.
Sam Weiss, chairman of Surfstitch Group, said the appointments were made due to significant external challenges, including two class actions, protracted litigation and an ASIC investigation which have brought high levels of uncertainty impacting the companies’ trading position.
John Park, Australia, corporate finance and restructuring leader at FTI Consulting, said the administrators will work closely with the operating businesses to preserve value for stakeholders.
“The legal proceedings against the non-operating Surfstitch companies will be stayed following the appointments, which will provide the Group with breathing space to focus on trading into the critical December peak period,” he said.
“The administrators will investigate the potential for a recapitalisation of the Non-Operating SurfStitch Companies with the intention of securing a better outcome for stakeholders.”
The administrators will provide a high level update on the progress of the administration and strategy moving forward at a creditors meeting expected to be held on Tuesday, 5 September 2017.