Fashion retailer liquidated
Kooky Fashions, a Kiwi-owned clothing chain with 14 stores between Whangarei and Christchurch, has been placed into liquidation.
A liquidators' report compiled by Waterstone Insolvency's Damien Grant says the company's director Suzanne Dunn attributed the failure to a downturn in the economy which "expended the cash flow of the business".
"Cash flow that was tied up in the stock of the company also contributed to the business failure."
The liquidator says initial investigations indicated those reasons were accurate.
ANZ National Bank holds a general security agreement over the business, and along with six other secured creditors is owed $1.88m.
All up creditors are believed to be owed $2.7m with only $1.6m of assets likely to be available to meet those commitments.
Some $900,000 worth of stock is sitting on Kooky's shelves, much of which the company will attempt to shift through a half-price liquidation sale ending June 26.
The liquidator says there is potential for the business to be sold as a going concern, although an attempt to sell the business immediately before liquidation was not successful.
There is unlikely to be any distribution to unsecured creditors, the liquidator says.
The company was formed in 2004 and is now owned by Suzanne, Jason and Anthony Dunn.
A spokesperson for Kooky referred BusinessDay to the liquidator for comment.