Postie Plus administrator finds foreign buyer
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The administrators of Postie Plus [NZX: PPG] has found a foreign buyer for the retail chain's assets and business, a day after their appointment.
PwC's David Bridgman and Colin McCloy reached a conditional agreement to sell Postie Plus as a going concern to an overseas-based retailer which doesn't have a presence in New Zealand. The buyer is conducting due diligence over the next three weeks, with the sale expected to be completed within the next four weeks, they said in a statement. A PwC spokeswoman declined to name the prospective buyer.
Postie Plus will continue trading while working through the sale process, which Bridgman and McCloy said is in "the best interests of the company's stakeholders, including its secured creditors, trade suppliers and other creditors, landlords as well as the company's more than 600 staff."
The retailer appointed the administrators yesterday after unsuccessful attempts to recapitalise the business, including an attempt to find a buyer or a new cornerstone shareholder.
In April, Postie Plus said it was in breach of its lending covenants and expected to remain so “for the foreseeable future,” meaning its bank funding is repayable on demand, though the arrangements it had in place with its bank were sufficient to meet the company’s forecast funding requirements up to July 30.
The company was hit by supply chain disruptions in the summer of 2012 and 2013 after outsourcing its distribution centre to a third party, while shifting its headquarters to Auckland, where it anticipated growth. After receiving legal advice, Postie Plus said it intends to “vigorously” pursue a damages claim.
Postie Plus shares last traded at 7.3 cents, prior to being halted last Thursday pending an announcement, and the stock market suspended it yesterday after the administrator appointment. The shares are the second-worst performer on the NZX All Index over the past year, having slumped 56 percent.