Queenstown bars the Boiler Room and Minus Five ice bar will be offered for sale in the next few weeks.
The companies running the bars, Queenstown Hospitality Ltd and Minus Five Queenstown Ltd owned by Jonathan Botherway, of Christchurch, were placed in receivership last Thursday.
Receiver Malcolm Hollis, of PricewaterhouseCoopers, said the collapse of Mr Botherway's Auckland Cargo Bar was responsible for his six remaining bars, including Four Nations in Auckland, 205 Cocktail Bar and the Parklands Tavern in Christchurch and the Brimstone Bar in Dunedin, being placed in receivership.
The Brimstone Bar has not been trading for at least a year.
Mr Hollis said he visited the two Queenstown bars at Steamer Wharf last week. They had been running at a profit in a good location with good staff.
The receiverships were appointed by a finance company, which Mr Hollis declined to name. He said Mr Botherway had bought the Loaded Hog bar for $3.4 million in 2007.
He refurbished it at a cost of $1.6 million and relaunched it as Cargo Bar in December last year.
However, $1.4 million of the fitting-out costs were still owing at the time of receivership, Mr Hollis said. The fitting-out had run $700,000 over budget and the bar was opened two months behind schedule.
It missed the pre-Christmas boom period and its turnover since opening was below expectations, he said.
Mr Botherway had made a deal with creditors to repay them over two years.
"Unfortunately, the profits were not where he wanted them to be and he was never going to be able to make those payments," Mr Hollis said.
The Boiler Room and Minus Five would open for "business as usual" under the receivers' management. The bars under control of the receivers would be offered for sale in the coming weeks, he said.
