The end is drawing closer for iconic music retailer Allans Billy Hyde, with receivers Ferrier Hodgson announcing yesterday it will start a major restructure that will begin with the immediate loss of 56 jobs.
But although receivers are looking for a buyer, it doesn’t look likely. Partner and receiver James Stewart said yesterday the restructuring will prepare the company for an eventual closure.
Such an event would result in the loss of more than 600 jobs.
“After serving consumers and the music industry for generations, the likely closure of the business and the loss of these jobs is very disappointing for all concerned,” Stewart said in a statement.
Although Stewart said there are still some interested parties, this is the most likely outcome.
If a sale isn’t finalised, Stewart says the closure process will see the Australian Music Group business wound up over the next few weeks. That not only includes Allans Billy Hyde and its 25 stores, but also the Musiclink and Intermusic businesses as well.
Over $45 million worth of stock will be sold off as part of the restructure.
However, Stewart highlighted that another subsidiary, Stage Systems, is not in receivership and is continuing to trade, and the Allans Billy Hyde franchise stores aren’t in danger of closure.
“We will work with the administrator to enable affected employees to make claims for their entitlements through the Government Entitlements and Redundancy Scheme (GEERS) as quickly as possible.”
If the closure goes ahead, 608 employees will lose their jobs, including 141 in the company’s head office.
The closure of Allans Billy Hyde has been a long time coming. Rumours of the company’s troubles circulated earlier this year, although managing director Tim Mason told SmartCompany the business received an injection of cash from an offshore entity to help with a restructure.
That same entity then called in receivers last month.
Independent music retailers have told SmartCompany that while there will be some short-term pain during the receivers’ sale, in the long term business will improve if stores close and customers flock to other stores.