Dick Smith CEO Nick Abboud calls it quits following electronics retailer's collapse

Dick Smith provides a cautionary tale for investors. Photo / Photosport.nz

Dick Smith's chief executive Nick Abboud has resigned, a week after the troubled electronics retailer collapsed into receivership.

Receivers Ferrier Hodgson said Abboud had tendered his resignation last night with immediate effect.

Don Grover, a more than 30-year retail veteran whose former roles include a stint as chief executive of Retail Fusion Brands and Dymocks, has been appointed as Dick Smith's interim CEO.

Ferrier Hodgson said Grover would assist the receivers and managers with the operation of the firm while a restructuring is carried out and potential buyers for the business are sought.

The company went into receivership last Tuesday owing roughly A$140 million to secured creditors, including HSBC and National Australia Bank, and around A$250 million to unsecured creditors.

Anchorage Capital, Dick Smith's former private equity owner, appointed Abboud as chief executive when it acquired the retailer in 2012, for around A$100 million, from supermarket operator Woolworths.

The business was floated on the Australian stock exchange the following year with a market value of A$520 million.

The receivers have today launched advertisements across a range of Australasian publications, including the New Zealand Herald, seeking expressions of interest for potential buyers of Dick Smith.

"These advertisements come on the back of over 40 initial expressions of interest from various parties prior to the commencement of the advertising campaign," Ferrier Hodgson said.

The sale process is expected to continue well into February.

The company operates 393 stores on both sides of the Tasman, including 62 Dick Smith stores in New Zealand.

The receivership came after the firm abandoned its profit forecast last month amid a sales slump that left it with high levels of excess stock, which had to be heavily discounted in the lead-up to Christmas.

Prices were slashed by up to 80 per cent in the fire sale, but it failed to have the desired effect.

Last week, Dick Smith chairman Rob Murray said December sales had fallen below expectations.

"The company explored alternate funding, however the directors formed the view that any success in obtaining alternative funding would not have been sufficiently timely to support short-term funding requirements and allow the company to order inventory during the next four to six weeks," Murray said.

"While confident on the long-term viability of the company, the directors have been unsuccessful in obtaining the necessary support of its banking syndicate to see it through this period."

The receivers have said gift vouchers would not be honoured, and deposits would not be refunded, due to the financial circumstances of the company.