July 27th will be the end of an era for the Levy family who have had control and run of Oroton since 1938, as Oroton will present its DOCA to the NSW Supreme Court.
Trying to recover from a November voluntary administration announcement, Oroton’s Deed of Company Arrangement (DOCA), that it entered into with Manderrah Pty Ltd in April, is set to be presented to the New South Wales Supreme court later this month.
July 27, Oroton’s D-Day, is when the supreme court will determine its future by either approving or rejecting the proposal of the transfer of Oroton’s shares from the current investors to Manderrah Pty Ltd.
This DOCA, if approved, will enable Oroton’s local and international stores to remain open, employment of staff to continue and will prevent the break-up of the business. As part of the agreed DOCA, Manderrah will pay a reported $5.25 million to the administrators. This money will be placed into a creditor’s trust deed fund to ensure that eligible creditors are paid back.
A recent independent report undertaken by KPMG stipulated that Oroton’s equity has nil value and therefore, creditors who are eligible for a return, will likely not receive it in full as Orton and its administrators are not in a financial position to do so.
Whilst it is a sad moment in Australian retail, as yet another one bites the dust, Oroton won’t be disappearing from our sights immediately as this DOCA works hard to keep the business in operation. We will be keeping an eye on this story for more news to come.
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