TVSN is holding a huge closing down sale - here's why

Direct Group, the multichannel retail and media business behind TVSN and Reader’s Digest, is being sold for $30m or a recapitalisation of the business, The Australian reports.

DG, which also owns Innovations and In Fashions, is seeking offers for the entire business, or its individual assets.

The business wants to secure new ownership and capital - which is the reason why it's also holding a mammoth closing-down sale.

Direct Group executive chairman Bernie Brookes said cash flow pressure has become intense since private equity owners Champ Private Equity Capital left.

Brookes said the business had, “an $8m loss to a $5m profit. But, when the private equity company exited, they left an enormous amount of debt and we never really recovered from that debt.”

He added, “We were going so well and then suddenly about a month and a half ago we started this spiral downwards as we couldn’t get stock.

“Our sales are tumbling because we can’t get stock to sell. So there’s an inevitability that we’re going to run into cash flow problems and so therefore we’re being proactive in actually starting a closing down sale.”

TVSN is the biggest drawcard in the sale. It includes two free-to-air channels, two Foxtel channels and two apps, in addition to its studio and production facilities - and a potential national audience of 17 million.

TVSN mega sale

Direct Group employs around 250 full-time and part-time staff, and part of the reason for TVSN's mega sale is to ensure their employee entitlements are met.

“If retail wasn’t in such a, pardon the French, a shit show at the moment, I think people would be looking at this as a great avenue,” Brooks further said. 

“(Direct Group) is so unique, it’s not just another retail outlet. The problem is that we’re swimming against the river because everybody in retail is cocooning at the moment and making it very hard to expand or look at those avenues.”