Pumpkin Patch owes $59.5m to ANZ – receivers KordaMentha

Failed children's clothing retailer Pumpkin Patch owes $59.5 million to its bank and at least $6.6 million to other creditors, receivers KordaMentha say in their first report on the

The company was tipped into receivership by its lenders and appointed voluntary administrators in October after failing to reinvent itself in the face of shrinking sales and too much debt. KordaMentha's Neale Jackson and Brendon Gibson were named receivers.

Pumpkin Patch owed its lender ANZ Bank New Zealand $59.5 million as of the date of receivership, the report says, up from $46 million at the year ended July 2016. It posted a loss of $15.5 million in the same period.

The company has $17.6 million in assets, with $13.5 million of that from investments and $3 million in fixed assets relating to its head office and distribution centre in East Tamaki, Auckland.

The receivers said they will look to sell the fixed assets once they are no longer needed as part of the realisation strategy they've implemented, which involves selling through the existing retail and online channels. Inventory is owned by another company within the group, Pumpkin Patch Originals, which is also in receivership.

Pumpkin Patch has a number of creditors who have registered financing statements under a Purchase Money Security Interest (PMSI), which has priority over other security interests. The receivers said they're in the process of assessing claims from those creditors including ANZ, Cafe Express, Childs Play and Fuji Xerox.

An estimated $2.7 million is owed to employees under preferential claims, with 1600 staff employed across the group, while Inland Revenue has not yet submitted a preferential claim. There are no floating charge assets the receivers expect to be realised to meet preferential claims.

Unsecured creditors are owed about $3.9 million, but it's too early to say if there will be funds available to pay them, the receivers says.

The shares were suspended on October 26, having traded at 6c, valuing the retailer at $10.1 million.

(BusinessDesk)