As first reported in The Mercury last week, administrators recommended that Illawarra Hawks Proprietary Limited -established in 2015 - be wound up after it was to found to be more than $2.4 million in debt.

It included more than $750,000 owed to former players and staff and more $500,000 owed to the ATO after the club ran at a loss of more than $1.8 million over the past three years.

Creditors followed that recommendation on Monday, voting to liquidate the company after former club owner Simon Stratford placed it into voluntary administration on April 2.

It prompted the NBL to take back the club's license on April 3, with the club's future resting in the hands of the league from then on.

Commissioner Jeremy Loeliger confirmed the liquidation of the former company will not affect the granting of a new Hawks license, with the league "well progressed" in its search for new owners.

"The Administrator's decision to liquidate the company that previously held the licence to operate the Illawarra Hawks does not affect the future of the Illawarra Hawks' participation in the NBL, nor does it affect the current process being conducted by the NBL to grant the licence to operate the club to new owners," Loeliger said.

"As we announced when the club was put into voluntary administration, the NBL is in discussions with a number of interested parties and we are well progressed towards finding the next owners of the franchise.

"The Hawks are one of the NBL's foundation clubs and we are committed to the club remaining in the league and continuing their unbroken participation in the competition since the NBL's inception in 1979."

Despite some recent hiccups in negotiations, a bid involving NAB Draft Aspirant LaMelo Ball and Illawarra businessman Tory Lavalle remains the front-runner, though the league insists multiple parties are in the mix.

A former minority partner, Stratford became sole director in March 2017 when former owner James Spenceley relinquished his share in the company he established in 2015.

It ran at a loss of more than $1 million the following year and lost in excess of $600,000 in 2019. The arrival of Ball as an NBL Next Star briefly boosted coffers, but the club still posted a loss of almost $100,000 at the time it went into administration.

It followed multiple attempts from Stratford to sell the club in the preceding months, with administrator Michael Jones recommending liquidation after early discussions around a potential Deed of Company Arrangement did not come to fruition.