Stationery store Kikki K receivers court possible buyers

Wednesday, 11 March 2020

Receivers of luxury stationery retailer Kikki K are working on a plan to sell the failed business.

The Australian company, which has seven stores in New Zealand was put into receivership in Tuesday after a difficult trading period in December and January.

Receivers Cor Cordis said stores in New Zealand would remain open company's financial position had been assessed.

There are 65 Kikki K stores globally employing the equivalent of 450 full-time staff.

Cor Cordis spokesman Michael Smith said it was too early to say what the future would be for the company but the receivers would like to keep it intact.

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Receivers Barry Wight and Bruno Secatore would have a better understanding of company's position by the end of this week, Smith said.

In a statement Wight said Kikki K had joined a 'long list of financially distressed retailers' to have fallen victim of 'softening consumer spending, high leasing costs, compounded by a disappointing December and January trading period'.

Kikki K was founded by Swedish entrepreneur Kristina Karlsson in 2001.

'That said, we believe Kikki K has a strong brand with a large global following, producing sales of almost A$70 million (NZ$72m) a year.'

The receivers were working with management on a plan to restructure the business for possible sale, Wright said.

Chief executive Paul Lacy said an 'unprecedented line up of external factors' such as the coronavirus had contributed to the business' collapse.

'We've had the triple-whammy of soft consumer demand, the business impact of bushfires and more recently the unprecedented and profound impact of coronavirus which is hitting so many businesses and countries so hard,' he said.

The unrest in Hong Kong, where Kikki K has a number of stores, had also taken a toll, Smith said.

'This unprecedented line-up of external factors, particularly in recent weeks, has really taken its toll. As we looked ahead we just didn't have the certainty we could keep going so have had to take this decision.'

Kikki K executives had been close to a rescue deal with a large global investor prior to the collapse, but 'ran out of time', Smith said.

Receivers would continue existing negotiations as well as look to other potential buyers, he said.

In the interim, stores would continue trading.