Pumpkin Patch vouchers honoured on dollar-for-dollar basis as kids' clothing stores go into receivership

Pumpkin Patch gift vouchers will be honoured on a dollar-for-dollar basis as the children's clothing retailer goes into receivership today in the face of shrinking sales and too much debt.

The board this afternoon appointed KordaMentha as receivers after the retailer's shares were placed in a trading halt last week and it said there was virtually no value left in its equity after talks with its lender ANZ Bank fell through.

Receiver Brendan Gibson has told media the stores remain open and trading as usual at this stage and the receivers will try "in the initial stages" to sell the business and staff as a going concern.

"The receivers have sought to preserve customer loyalty as far as possible," he said. 

"In that regard, customers holding unused Pumpkin Patch and Charlie & Me gift vouchers will be able to redeem them on a dollar for dollar basis. For example a $40 purchase would be paid by a $20 gift voucher and $20 in cash or credit card.

"So we are trying to give some value to those gift card holders who otherwise would be unsecured creditors."

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Sadly this will result in job losses

—  Receiver Brendan Gibson |

A customer with a $100 gift voucher, for example, would need to spend $200, paying half with the voucher and the rest by cash or credit card.

Jobs will go, however, and Mr Gibson said due the the rules of being a publicly listed company, the receivers were unable to inform staff before the news became public.

Pumpkin Patch is headquartered in New Zealand where it has 43 stores, a wholesale and online business and approximately 600 staff.

In Australia there are 117 stores and approximately 1000 staff.

Some stores have already closed following an announcement earlier this year and "this programme is now likely to accelerate in an effort to prove its saleability and viability as a business," Mr Gibson said.

"Sadly this will result in job losses. We are now working with the management team to identify and consider viable options for the business."

Mr Gibson said all staff will be paid for their work in receivership. 

"In regard to their entitlements in holiday pay and redundancy, the situation in Australia is that all staff are covered under the law for their preferential entitlements due up until today."

In New Zealand, there is a statutory cap for those entitlements of $22,160 and they are paid out of stock realisations, he said.