Oroton creditors back $25m rescue bid
After OrotonGroup received a takeover proposal from shareholder Will Vicars earlier in the month, creditors of the Australian accessories company said on Thursday the firm will accept the AU$25 million rescue plan proposed.
The luxury Australian accessories brand will transfer into private ownership to Vicars under the agreement, poised to return between 36 and 58 cents in the dollar to creditors with all staff entitlements and no further store closures.
At a meeting on March 29 in Sydney, Oroton's creditors voted in support of Vicars' rescue plan. Now, the courts will transfer all ASX-listed shares to his organisation --Caledonia Funds Management -- by which Vicars already owns 18.2 per cent of Oroton.
In mid-March when the bid was proposed, Deloitte, administrators for Oroton, said it backed the proposal to salvage the collapsed luxury leather goods retailer.
At the time, Deloitte said 10 jobs had been lost in total across Oroton's head office and its stores.
Oroton, founded in 1938 by the Lane family, has struggled in the last five years as it lost market share to more recognised foreign brands such as Michael Kors and Kate Spade.
It filed for administration in November as it struggled under the weight of a $40 million debt load, reporting a $14.3 million full-year loss on the back of weak sales, and a failed Gap apparel distribution licence, which saw 264 staff made redundant as a result of the wind down.
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