Customers with gift vouchers for fashion retailer Republic have been told they are set to lose out on £1.2 million in gift vouchers.
Republic was put into administration in February 2013 following poor sales in the lead up to Christmas, and was bought the same month by Sports Direct, owned by Mike Ashley.
Customers may have hoped for a similar situation to that of HMV, after administrators Deloitte announced it would be redeeming gift cards and vouchers, prior to its sale to Hilco earlier this month.
Administrators Ernst & Young stopped the redemption of Republic gift cards sold before 13 February 2013, deeming the outstanding balance of £1.2 million as an “unsecured claim”.
The administrators report said it is “not the responsibility” of owners Sports Direct to honour the gift cards and means that 78,000 customers will be left empty handed.
The report states that Republic’s debts amounted to £157 million, including £64.4 million to a banking syndicate comprised of Lloyds Banking Group, Investec, and equity firm TPG Aquatic.
Only £15.3 million is predicted to be raised from the sale of its assets.
Republic, including its 114 stores, brands and stock, was sold to Sports Direct for £9.8 million just three years after it was acquired by equity firm TPG for approximately £300 million.
Sports Direct is the UK’s largest sports retailer by revenue and operating profit, with approximately 400 stores across the UK.