Will Kogan buy Dick Smith?
Ruslan Kogan, founder and CEO of Kogan.com, has described the collapse of rival electrical retailer Dick Smith as “bittersweet” and didn’t rule out acquiring the iconic Australian brand.
When asked if he would consider buying Dick Smith following its foray into bricks and mortar, Kogan responded:
“We’re always considering all opportunities.”
Ferrier Hodgson were this morning appointed receivers and managers of Dick Smith, after the company’s board placed it into voluntary administration.
Dick Smith chairman, Rob Murray, said in a statement he was confident of the long-term viability of the company, however the directors had been unsuccessful in obtaining the support from its banking syndicate to see it through the short term.
Ferrier Hodgson partner, James Stewart, said it would be business as usual while the receivers look at the restructuring opportunities for the group.
“We are immediately calling for expressions of interest for a sale of the business as a going concern,” Stewart said.
Dick Smith operates 393 stores across Australia and New Zealand under four brands, has 3300 employees and annual sales of approximately $1.3 billion.
Stewart said that the New Zealand business was profitable and expected it would be attractive to potential buyers.
He added that employees will continue to be paid by the receivers and that it is expected that Australian employee entitlements will be covered under the Fair Entitlements Guarantee (FEG) scheme if the business cannot be sold as a going concern.
Ruslan Kogan released a statement following news of Dick Smith’s demise, calling it a sign of the changing retail landscape.
“Dick Smith has been an iconic Australian brand for decades and it’s sad to see their demise. It’s a sign of the changing retail landscape that has more and more Aussies turning online for the latest products at the best prices,” Kogan said.
“It’s a bittersweet situation. On one hand, we love competition — it gets us out of bed in the morning. On the other hand, Kogan.com is proud to have played a significant part in creating more efficiency in the industry and driving down prices for shoppers, which has had a noticeable effect on many large retailers, past and present.”
Dick Smith’s situation would have no impact on Kogan’s pricing strategies, he said.
“While it’s common for retailers to raise prices when there is decreased competition, there won’t be anything like that at Kogan.com — our mission is to make the latest products more affordable for all Australians and we’ll keep using technology to innovate new ways to drive prices down,” Kogan said.