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Brown Sugar appoints Voluntary Administrators


Thursday, 4 August 2011: The directors of clothing retailer, Brown Sugar Australia Pty Ltd have appointed partners of Deloitte Corporate Reorganisation Group, Sal Algeri and Tim Norman as joint Voluntary Administrators pursuant to Section 436A of the Corporations Act 2001.

Brown Sugar is a well known retailer of women’s fashion. Established in 1975, Brown Sugar has 50 full time staff and 170 part time and casual staff across 40 stores in VIC, NSW, SA, TAS and WA.

A creditors’ meeting will be held on Friday, 12 August 2011 where the Voluntary Administrators will outline their initial findings and the role of the Voluntary Administrator.

“Our first priority is to try and achieve the best possible outcome for all stakeholders – employees, creditors and customers,” said Mr Algeri.

“All Brown Sugar stores will commence a stock clearance sale shortly while the Voluntary Administrators assess the company’s financial position and seek expressions of interest to purchase the retailer,” he adds.

The Brown Sugar brand has suffered as a result of successive management changes since 2009 and, despite the current management team working to restore the company’s trading position, adverse trading conditions and falling consumer sentiment have continued to hamper the company’s return to profitable trade.”

Mr Algeri said that while the company continued to trade, all ongoing employees’ salaries and benefits would be honoured.

Customer and Creditor Enquiry Lines
In order to address the questions of those affected by the appointment, the Voluntary Administrators have established enquiry hotlines for customers and creditors of the company.

Contact name: Troy Woolston
Tel: +61 3 9671 6441


Which stores will remain open?
All stores will remain open while the Voluntary Administrators assess the viability to continue trading.

Can I get a refund of my lay by deposit, if I have paid one?
The Voluntary Administrators will be able to investigate refunds when the full financial position of the company has been established.

Can I use a gift voucher which was issued before your appointment?
The Voluntary Administrators will be able to honour gift vouchers which were issued before the appointment only where each gift voucher is redeemed for up to 50% of the value of an item.

What about the stock in the shops: can I take the stock that I have paid a lay by deposit or have a gift voucher for?
The Voluntary Administrators will be able to honour lay bys only where lay by holders pay out the value of their outstanding balances by cash. Lay by holders cannot redeem their lay by deposits for cash. Gifts vouchers cannot be used to pay off lay bys.

When will the Voluntary Administrators give us more information?
The Voluntary Administrators will hold the first meeting of creditors (including those who hold gift vouchers) at 10am on Friday, 12 August 2011 at the Melbourne offices of Deloitte at 550 Bourke Street, Melbourne VIC 3000 to outline initial findings and the role of the Voluntary Administrator. A full creditors’ report will be released prior to the second creditors’ meeting.

What will happen to Brown Sugar’s employees?
Brown Sugar’s employees have been notified of the appointment by the Voluntary Administrators. They are classified as creditors of the company. The Voluntary Administrators will be updating employees on the plans for the administration and any restructure on a regular basis.

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Job Title:
Dawn Willis
Deloitte Australia
Job Title:
Corporate Affairs and Communications Manager
Tel: +61 2 9322 5562




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