Cameron admits price of failure

KATHMANDU founder Jan Cameron has virtually ruled out a second attempt to regain control of her discount retail empire, saying “I failed and have paid the price for that failure”.

Ms Cameron, who appointed administrators and receivers to retail holding company DSG Holdings Australia last week, appears to have no plans to buy back DSG’s 100-plus profitable Sams Warehouse and Crazy Clarkes stores.

Rather, the 60-year-old philanthropist, environmentalist and animal welfare advocate is relieved that her five-year foray into the discount variety sector has come to an end.

“I’m relieved that I can stop worrying and trying desperately to make the company work,” Ms Cameron told Fairfax Media.

“I don’t feel bitter (but) disappointed for all the staff. Some of them are finding jobs but it will be very difficult for others.”

DSG’s receivers, David Winterbottom and Rahul Goyal, of KordaMentha, have received 25 expressions of interest from parties keen to take over some of DSG’s remaining stores. None have expressed interest in the entire store network.

More expressions of interest are expected before the July 17 deadline, Mr Goyal said.

However, Ms Cameron, who is estimated to have lost more than $200 million of her fortune on the venture, is not among them.

When Ms Cameron’s former company, Retail Adventures Pty Ltd, collapsed in October 2012 after racking up losses of $114 million in two years, Ms Cameron used her position as the largest and only secured creditor to buy back the business three months later.

“(Jan) can regain control, but my conversations to date have been about her exiting this business,” Mr Goyal said.

This time, there will be little to buy back.

The receivers plan to close about 40 of the remaining 143 Sams Warehouse and Crazy Clarks stores, all of which are leased, and are looking for trade buyers for the balance.

The receivers are also winding up DSG’s distribution centre in Queensland and head office in North Ryde.

This means potential buyers would need to have warehouse and logistics systems in place.

“We’re hoping to find someone who has the back office infrastructure and can add the stores onto their network,” said Mr Goyal.

“They don’t necessarily need to be in this (discount variety) space but to have the warehousing and logistics, so it could be someone in a complementary business,” he said.

“Lots of people are looking at it strategically to expand their own business as they (DSG) have some great locations with little competition.”

Ms Cameron is DSG’s only secured creditor and is owed about $100million, while unsecured creditors are owed about $15 million and DSG’s 2500 employees just under $10million in entitlements.

Mr Goyal says KordaMentha is hoping employee entitlements will be covered by funds raised by selling off stock.

Whether Ms Cameron recoups any of her investment depends on funds raised from selling the rest of the business.

“We are hoping she gets something back from this,” Mr Goyal said.

Meanwhile, Ms Cameron is still being pursued by creditors of Retail Adventures over allegations of insolvent trading and preferential payments.

Mediation talks failed last week and Ms Cameron faces a public examination of her finances next month.

According to Retail Adventures liquidator, Deloitte, part of the price DSG paid to buy back control of the business after it collapsed in 2012 was offset against Ms Cameron’s secured loans.

Deloitte believes Retail Adventures may have been insolvent at the time security was granted and the security is therefore voidable.

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