Denim super-brand Ksubi has been officially placed into receivership with staff slashed, following a string of financial setbacks.
Specialist advisory and consulting firm Jirsch Sutherland has been appointed as receiver and manager of the companies previously known as Ksubi Copyright Pty Ltd and Mentmore Pty Ltd.
Jirsch Sutherland partners Andrew Spring and Roderick Sutherland will manage the case as joint receivers, effective this week. The appointment was made by the company’s principal lender.
The receivers have confirmed that they are currently assessing the financial position, but confirmed that staff jobs at the Rosebery Ksubi headquarters have been cut to reduce overhead costs.
“There has been some necessary rationalisation of overheads including staff at head office.”
Media reports also suggest staff at the Rosebery Ksubi headquarters have been advised that they would not be paid their final week’s salary or superannuation.
Jirsch Sutherland also revealed that the companies are continuing to trade seven retail outlets throughout metropolitan Melbourne, Sydney and Brisbane, in addition to an online retail store.
“The companies are also continuing to operate a wholesale business, selling locally and internationally the three brands – Ksubi, Insight and Something Else,” Spring said.
“We are continuing to trade with a view to identifying a purchaser for these businesses. Due to the strong local and international reputation of these three brands, we are optimistic that a purchaser for the business will be found.”
The Ksubi brand was founded by Dan Single and George Gorrow in 1999.
The news follows a tough time for the label, after Sydney-based former parent company Bleach announced a recapitalisation and restructuring plan and was placed into voluntary administration.
Bleach Group formerly housed Ksubi, along with fellow iconic local labels Insight and Something Else.
As reported on ragtrader,com.au, it is understood the move was made necessary primarily because of the closure of Bleach Group’s major Asia-based supply chain/sourcing factory in May 2013.