HOPE FOR 2,000 FASHION CHAIN STAFF
Collapsed store is saved by takeover
COLLAPSED fashion chain Peacocks has been saved by a senior executive with backing from an international consortium, it has been revealed.
Chief operating officer Steve Simpson will take over the business, saving 2,000 jobs and 200 stores, which he hopes to reopen once lockdown restrictions on nonessential retailers ease.
The number means half the 400 trading at the time of the chain’s collapse last November will not reopen as Peacocks.
Peacocks has already closed its Hanley branch and Newcastle was set to follow suit soon. The fashion retailer also has branches in Leek and Congleton.
The chain was part of retail mogul Philip Day’s Edinburgh Woollen Mill (EWM) fashion empire which collapsed in November last year.
Mr Day was the biggest creditor of Peacocks and is owed money by
the business he once owned.
Administrators FRP negotiated a deal with him by signing a deferred loan agreement between a consortium of investors and the businessman which will eventually see him get his money out of the company.
A statement from the administrators, FRP, said the collapse of the chain was due to ‘the devastating effects of the Covid-19 lockdown’ on the business.
The Peacocks’ management team hope that, with the support of their
partners, suppliers and landlords, they will be able to reopen up to 200 stores.
The statement added the company hoped all 1,850 store staff, who are currently on furlough, will be able to return to work once stores reopen, along with more than 150 in head office and support.
A similar deal was set in place with the EWM and Bonmarche brands, while Mr Day’s other brand, Jaeger, was sold to Marks & Spencer, where it will become an online-only business.
The deal essentially sees the EWM brands – excluding Jaeger – reform under the old management led by Mr Simpson.
Mr Day will not be in control of the business – ending several decades of involvement in the UK high street – and will hope to recoup the cash he invested as a secured creditor through the deal.
Unsecured creditors, including landlords, suppliers and the taxman, will lose out and are unlikely to get their money back.
According to reports, Sports Direct tycoon Mike Ashley was also said to be interested in the Peacocks brand, although administrators failed to reach an agreement with him.
Peacocks had 400 stores going into the pandemic a year ago and announced a series of job losses and store closures as it struggled to manage under the various restrictions.
The chain had a poor online presence compared with rivals.