About 610 jobs are likely to be lost when music instrument chain Allans Billy Hydes closes its doors in coming weeks.
Receivers have failed to find a buyer for the chain’s owner, Australian Music Group, and this evening made the first move towards shutting it down, laying off 56 staff at company headquarters in Rowville.
The receivers, Ferrier Hodgson partners James Stewart and Brendan Richards, said they remained in discussions with interested parties who might buy the group at the last minute.
But in a sign the end is near for the venerable Allans name, the receivers will tomorrow morning launch a sale to clear about $45 million of stock.
All company-owned Allans Billy Hyde, Musiclink and Intermusic stores are set to close, but the collapse does not affect franchised stores or the group’s hiring operation, Stage Systems.
“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,” Mr Stewart said in a statement.
He said he would work with administrators Ross Blakely and Andrew Schwarz of Taylor Woodings ‘‘to enable affected employees to make claims for their entitlements through the Government Entitlements and Redundancy Scheme as quickly as possible.”
The Allans business dates back to 1850, when a music warehouse was set up Melbourne by a Joseph Wilkie.
George Allan joined the company in 1863, and by 1881 his son was in control of the business, now re-named Allan & Co and the largest music warehouse operation in the southern hemisphere.
The group survived a stint in the hands of Brashs, before the music retailer’s collapse in the late 90s and eventually ending up in the hands of private equity group Crescent Capital in 2007.
It merged with rival Billy Hydes in 2010 but mounting problems saw Crescent sell its 72 per cent stake of the business at a loss the following year.
Mr Stewart and Mr Richards were appointed receivers by secured creditor Revere Capital, owed about $27 million, on August 27.
An additional $13.5 million is owed to unsecured creditors while staff entitlements total $3 million.
There are 24 company-owned stores around Australia, including eight in both Victoria and New South Wales.