The future of the Eastbourne branch of BHS remains uncertain as the retailer enters administration today (Monday, April 25).
The retailer, which employs around 11,000 people, went into administration after owners failed to secure a last-minute deal to rescue the 88-year-old business.
Administrators Duff and Phelps say they will now try to sell the company as a going concern – keeping its 164 stores open for the time being.
Speaking this morning a spokesman for Duff and Phelps said, “The group has been undergoing restructuring and, as has been widely reported, the shareholders have been in negotiations to find a buyer for the business. These negotiations have been unsuccessful. In addition, property sales have not materialised as expected in both number and value.
“Consequently, as a result of a lower than expected cash balance, the group is very unlikely to meet all contractual payments. The directors therefore have no alternative but to put the group into administration to protect it for all creditors. The group will continue to trade as usual whilst the administrators seek to sell it as a going concern. Further announcements will be made as appropriate in due course.”
Following the announcement Usdaw, a union which represents BHS shop workers, called for the government to step in and ensure protection for employees’ redundancy payments and pension scheme - which is reported to be running at a deficit of £571 million.
John Hannet, the general secretary of Usdaw, said, “We don’t want to see BHS staff locked out of discussions, sent to the back of the queue of creditors and treated like fixtures and fittings, as happened at Woolworth’s.
“The Government needs to intervene now to protect taxpayers from picking up the bill for redundancy payments and safeguard the Pension Protection Fund.
“We are in touch with our members working in BHS to reassure them that we will provide the support, advice and representation they require.”
Speaking this morning, business secretary Sajid Javid said the Government was in talks with BHS management. Business minister Anna Soubry is expected to update parliament about the talks later today.
Last month BHS owners the Retail Acquisitions Consortium reached a major deal with creditors to cut the rent at 87 of its 164 stores.
The deal had been expected to secure the company’s short term future, but on Friday (April 22) owners revealed it still needed to find £100 million in order to pay staff wages and stay afloat.
The consortium bought the business for just £1 last year from Sir Philip Green, owner of the Arcadia Group.
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