Another storied retail chain has fallen victim to the downturn in spending and rising competition from overseas, after its largest shareholder pulled the plug on the operation.
Australian Music Group Holdings, owner of the 30-store Allans Billy Hyde chain, has been placed in voluntary administration today, chartered accountancy Taylor Woodings confirmed. London-based majority shareholder Revere Capital has decided to call time on the musical instrument retailer.
‘‘The majority shareholder has surprisingly decided it doesn't want to support the business through the build up through Christmas, so it's taken this fairly shock position to withdraw funds,’’ said joint managing director Tim Mason.
Taylor Woodings has been appointed administrators. Ferrier Hodgson partners James Stewart and Brendan Richards have been appointed receivers and managers.
“We are immediately calling for expressions of interest for a sale of the business as a going concern,” said Mr Stewart.
Employees will continue to be paid by the receivers and entitlements would be be covered under the Federal Government’s General Employee Entitlements and Redundancy Scheme if the business can't be sold.
However, outstanding gift vouchers won't be honoured nor will deposits be refunded, Ferrier Hodgson said. The affected customers will instead become unsecured creditors of the group.
The Melbourned-based group with roots going back to the 1850s had more than 500 employees in 2011.
Accounts filed with the Australian Securities and Investments Commission showed that the company breached a $40 million debt covenant with National Australia Bank in 2011, although Mr Mason said that had been resolved.
News of the collapse follows similar failures of confectionary Darryl Lea, electronics chain Retravision, clothing store Colorado Group, and book chain in 2011.