Threat of closures

Some Shanton stores may close.

Retail chain Shanton Fashions is looking to trade itself out of financial difficulty after placing itself into voluntary administration yesterday, but some stores may close.

The chain of 37 shops employs 240 people nationally, 10 in Hastings and Napier.

Branches would continue to trade and staff would be paid, but gift vouchers and layby purchases would be processed by the administrator. Bryan Williams, of BWA Insolvency, said the move was in response to the withdrawal of Shanton's credit facilities and a demand for immediate repayment.

"Despite the company having its liquidity greatly reduced, the directors are still of the view that the business can continue and the brand survive," he said.

"They are highly motivated to achieve this outcome, which is why they have elected voluntary administration (VA).

Restructuring required "further investigation".

"The clear intention is to preserve the inherent value in the brand. This is largely comprised of the product that it sells, the location of it stores and the people that design, make and sell the product."

He said the VA was implemented where there was a presumption the business could continue.

"It is the legal framework that enables the potential for a workout from difficult economic circumstances. Liquidation is terminal in the company's life whereas VA offers hope of commercial revival brought about through the skills of the administrator to focus and harmonise all the resources of the company into a recovery plan."

He was unable to say how much was owed.