Buyers are being sought for failed menswear chain Ed Harry, which owes creditors and employees$8.65 million

The administrators of menswear chain Ed Harry have started a formal search for potential buyers of the business, while revealing the company owes creditors and employees $8.65 million.

Ed Harry fell into administration last week.

• Ed Harry falls into administration, putting 108 SA jobs at risk

The administrators of menswear chain Ed Harry have commenced a formal search for potential buyers of the business while revealing the company owes creditors and employees $8.65 million.

At the first meeting of creditors held in Adelaide this morning, it was revealed the company owes approximately 100 trade creditors $1.4 million, while close to 500 employees across the country are owed $1.25 million in entitlements.

The company, which has its headquarters in Hindmarsh, owes 33 landlords approximately $2 million while 20 secured creditors are owed $4 million.

Creditors were told any potential dividend would be dependent on the sale of the business or sale of inventory across the store network.

Administrator Brendan Richards from KPMG confirmed a campaign to sell the business had commenced, and that a number of parties had already expressed an interest.

“We remain hopeful that a sale of business campaign will result in a positive outcome for Ed Harry’s employees and key stakeholders,” he said.

“In addition, we would also like to acknowledge employees, trade creditors and a number of landlords who have provided support which maximises the prospects of a strong outcome for creditors.”

Since their appointment last week as administrators of Specialty Mens Apparel - trading as Ed Harry - Mr Richards and joint administrator Gayle Dickerson have continued to trade the retailer’s 87 stores as normal, including 14 in South Australia.

They have embarked on a clearance sale of existing merchandise, with further price reductions recently put in place.

“We have seen a really positive response from customers since our appointment,” Mr Richards said.

“This highlights the strength of the Ed Harry brand and indeed the strong levels of customer loyalty Ed Harry has developed since 1993.”

Ed Harry fell into voluntary administration in early 2011, with a network of 130 stores, and was bought and relaunched later that year by Specialty Mens Apparel, headed by managing director David Clark.

Last week he called in KPMG, with a slow Christmas trading period, intense online competition and a lack of funding blamed for the company’s demise.

Ed Harry currently has 498 employees across its national network of 87 stores, including 108 head office and retail workers in South Australia.

The administrators are seeking seek an extension to the convening period before the next creditors meeting to enable the sale of business or completion of the “inventory realisation program”.

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