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A deal to rescue iconic retailer Barbeques Galore from administration has collapsed, with up to 500 jobs to go as the group synonymous with Australia’s barbecue culture prepares to shut its remaining company stores in the coming weeks.
The group’s receivers said creditors had backed an agreement to keep Barbeques Galore operating but failed to reach commercially acceptable terms with landlords and suppliers. The retailer fell into administration and receivership in February.
Barbeques Galore has a network of 89 stores, 62 of which are company-owned and will undergo a controlled wind-up process from June 16. The remaining 27 franchisee-owned stores are independently operated and will work through “transitional arrangements”.
Any rescue deal to keep Barbeques Galore out of a liquidation process was always conditional on negotiations between landlords and suppliers, said the company’s receivers, headed by Quentin Olde, in a statement.
While Barbeques Galore has been under receivership, suppliers have been paid upfront for stock. Under the proposed deal, suppliers were to move back to normal arrangements where stock was supplied on credit, but some suppliers wished to be paid earlier than the proposed terms, he added.
“Some Chinese suppliers were unable to agree to terms because they couldn’t get reinsured, and there were a couple of other suppliers that were refusing to go back to commercial terms,” Olde told this masthead.
The federal budget also led to a downturn in sales, he added. “There’s been a change in consumer sentiment, particularly around discretionary goods.”
The receivers said they will continue to trade the business and explore sale transactions for the remaining stores and assets, including its name.
Gift cards will continue to be honoured, but customers must spend $2 to redeem every $1. For example, a $50 gift card requires a customer to make a total purchase of $150, with $100 to be paid after the gift card is applied. Gift cards will not be redeemable after June 30.
Employees will be made redundant as the winding-up of its business takes effect. Staff will be paid all employee entitlements, benefits, redundancies and termination payments in full, Olde said.
The group has been losing market share to rivals such as Harvey Norman and Bunnings, as well as online retailers, despite the market for barbecues growing strongly as Australians invest heavily in outdoor lifestyles.
Losses totalled more than $30 million over the past three financial years, while sales of its barbecues and heaters have stagnated in the $170 million range.
Quadrant Private Equity acquired Barbeques Galore in 2012 and extracted a dividend of $5.6 million as recently as 2024 despite ongoing losses.
In the retailer’s most recent accounts lodged with the Australian Securities and Investments Commission (ASIC) in December, its auditors pointed to issues that “cast significant doubt on the ability of the group to continue as a going concern”.
This includes ongoing losses, the fact that current liabilities exceed current assets, and its precarious financing.
Gordon Brothers, a Boston-headquartered investor that specialises in distressed lending, bought out the Commonwealth Bank as the retailer’s secured lender in October last year, and acquired Quadrant’s equity stake for a nominal amount in December.
On January 22, newly appointed board member Mark Dewar contacted Grant Thornton’s Philip Campbell-Wilson about “potential insolvency concerns”, according to documents lodged with ASIC.
The Barbeques Galore board appointed administrators led by Campbell-Wilson on February 12.
Gordon Brothers called in receivers, led by Ankura’s Quentin Olde, the same day.
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