Spotlight wins right to buy Harris Scarfe
Fabric and homewares chain Spotlight has won the exclusive rights to purchase Adelaide-founded department store Harris Scarfe, which was placed in receivership late last year.
Deloitte Restructuring Services announced this morning that Spotlight Group had been granted exclusive acquisition rights, following “a vigorous due diligence process”.
Spotlight won the rights ahead of three other, unidentified businesses, which were shortlisted and given access to key trading records as part of the process.
Harris Scarfe has about 1300 employees in 44 stores around the country.
Its flagship Rundle Mall store has closed, but eight other SA stores are continuing to trade.
Deloitte’s Vaughan Strawbridge said in a statement: “There is still a lot of work we need to do together to finalise the transaction and we will be working with the Spotlight Group and the Harris Scarfe Leadership team to make this happen.”
“We are hopeful all of the 44 stores will be retained under the sale but ultimately, this will be dependent on how the transaction progresses over the next couple of weeks.”
Settlement of the sale is expected around the middle of April.
Sydney-based equity firm Allegro Funds placed the companies behind the Harris Scarfe chain under voluntary administration in December, nine days after it had acquired them from Greenlit, the Asia-Pacific subsidiary of South African furniture behemoth Steinhoff International.
The Harris Scarfe companies collectively owe unsecured creditors about $98 million.
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But trade suppliers and landlords won’t see a dollar until and unless Allegro Funds is paid first because the firm is a secured creditor, owed approximately $70 million.
READ MORE: Equity firm that put Harris Scarfe in admin first in line for payout
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