The Queensland-based business which operates 15 stores across Australia was placed in administration yesterday afternoon.
Founded in Townsville in 2003, group turnover for the 2011 financial year was down 7.7 per cent year-on-year to $257 million.
“WOW has been subject to declining sales and profitability which has escalated in recent months,” said Ferrier Hodgson partner James Stewart.
“We will be seeking expressions of interest for a possible sale of the business as a going concern immediately.”
Stewart said WOW had been impacted by $20 million of bad debt related to the 2010 collapse of Aristocon Pty Ltd, the property development and construction company associated with WOW directors Sam Savvas and Suds Sotiris.
According to Ferrier Hodgson, the $20 million in bad debt owed to WOW is unrelated to a further $25 million in debt that WOW owes to unsecured creditors.
WOW’s 500 employees, protected under the General Employee Entitlements and Redundancy Scheme, have entitlements totalling $4 million.