Smiths City placed into liquidation with creditors owed at least $25m

Friday, 3 October 2025

Creditors have voted to put Smiths City into liquidation after it fell into voluntary administration facing more than $25 million in claims.

The Christchurch-based retailer went into voluntary administration on September 2 with BDO’s Colin Gower and Diana Matchett appointed joint administrators.

A BDO spokesperson confirmed to The Press on Thursday that creditors had voted on Wednesday to place the company into liquidation at a watershed meeting, with Gower and Matchett staying on as liquidators.

The voluntary administration was announced on Tuesday morning, with all nine of Smiths City stores and its online shop temporarily closed, and with its website offline.

Eight of the nine Smiths City stores reopened for a liquidation sale, with The Press reporting all but the the chain’s Colombo St store in Christchurch were now closed.

Founded in 1918, Smiths City has faced mounting financial pressures due to declining sales and a tough economic environment, BDO said in a statement.

The Press reported that in their report report last month Gower and Matchett said the company was insolvent so didn’t have a deed of company arrangement (DOCA) which would keep the company trading through the administration, as with most other cases.

They said the only options were liquidation or returning the company to sole director Colin Neal.

The Press said they ruled out the latter, recommending liquidation as the “orderly wind-up” path after selling off all company assets to let secured and preferential creditors recover amounts due.

But it reported unsecured creditors with claims at more than $10.5m weren’t likely to get money back, Gower and Matchett said.

Based on accounting records, The Press said total creditor claims were at $25.7m, including $9m in secured claims due to ASB Bank, Polar Capital (director Colin Neal’s vehicle) and Smiths City Finance.

The company’s 100% shareholder Polar Capital was claiming more than $6m after funding the company since 2020 to keep it running, Neal said in the report.

The company also owed gift card holders $362,000, but Gower and Matchett said it didn’t have their contact details, The Press reported. It said gift card holders would only get what’s owed to them by contacting the administrators directly.

Secured creditor claims were more than $5m, with Australasia’s biggest mattress and foam manufacturer, Comfort Group, claiming the most at $2.9m. Others included Electrolux, Samsung and Bosch.