Dick Smith is set to close its doors for the last time, ending a near 50-year era in which it helped Australians fill their homes with TVs, radios and computers.
Receiver Ferrier Hodgson said on Thursday it has been unable to find a buyer for the troubled electronics retailer, which hit the rails in January with debts of about $400 million.
The retailer, which blossomed with the CB radio boom of the 1970s and went on to sell computers and stereos to generations of consumers, will close 363 Australian and New Zealand stores within eight weeks.
A total of 2890 staff will lose their jobs, with their only consolation that they will be placed ahead of secured creditors when it comes to receiving money they are owed.
Ferrier Hodgson had been trying to find a buyer for all or parts of the business since taking over the running in January, but has had to admit defeat.
“While we received a significant number of expressions of interest from local and overseas parties, unfortunately the sale process has not resulted in any acceptable offers for the group as a whole or for Australia or New Zealand as standalone businesses,” receiver James Stewart said in a statement.
“The offers were either significantly below liquidation values or highly conditional or both.”
The closures will affect 2460 staff across 301 stores in Australia, and 430 in 62 New Zealand outlets.
All Australian employee entitlements are expected to be paid in full, while New Zealand employees will get up to the $NZ22,160 permitted by NZ law.
Dick Smith staff were told of the closure on Thursday, and Mr Stewart thanked them for their “support and patience”.
The future of the cash-strapped company, founded under a north Sydney car park in 1968, has been in doubt since it issued a pair of profit warnings in late 2015.
Rumours that the company had rashly purchased piles of stock no one wanted to buy were then given credence when a pre-Christmas fire sale failed to raise enough cash for Dick Smith to meet its obligations to its banks.
The full scale of the problems became public on January 5 when Dick Smith informed the Australian Securities Exchange that it had gone into voluntary administration.
Customers holding unredeemed gift cards and those who had paid deposits for goods were left among unsecured creditors owed $250 million.
They may be left empty handed once the banks and other secured creditors get the $140 million or so they are owed.
Dick Smith’s eponymous founder, who started what was initially a car radio installation business for $610, said the seeds of the decline were sown during it aggressive expansion under Woolworths, which bought the company from him in 1982.
It was then purchased and resold at more than five times the price by a private equity company.
The receiver closed 27 concessions in David Jones department stores at the end of January in an effort to cut costs, but to no avail.
Only the company’s airport stores will now get a reprieve.