Woolworths chain in Britain faced with collapse - Summary
|
|
|
|
Published
:
Wed, 26 Nov 2008 03:25
|
London - The Woolworths retail chain in Britain, which has had a presence on the High Street for nearly 100 years, is to file for administration, company sources said Wednesday. The collapse of the retail empire, which employs more than 25,000 staff in 815 outlets across Britain, came after last-minute efforts to save the company failed Wednesday, the BBC reported. The Woolworths board was due to take a formal decision at a meeting Wednesday evening. Reports said Woolworths, which reported half-yearly losses of nearly 100 million pounds (150 million dollars) in September, had struggled under the weight of debt of 385 million pounds. Trading in Woolworths shares was suspended on the London Stock Exchange Wednesday as rescue efforts continued. According to the BBC, accountancy firm Deloitte will be called in as administrators of the store chain. Analysts said the chain's problems had been compounded by the credit crunch, when it was forced to pay cash to suppliers as trade credit insurers were no longer prepared to insure supplies. However, the current economic slowdown was as much a reason for the collapse of the giant chain as competition from out-of-town shopping centres, cheaper rivals and the internet, they said. The BBC reported that Business Secretary Peter Mandelson had been in contact with the Woolworths board Wednesday. While a government bailout was out of the question, Mandelson had pledged to do what he could to protect the company's pension fund and make sure that its stores would remain open during the run-up to Christmas. Woollies, as it is affectionately known in Britain, opened its first store in Liverpool in 1909, as a subsidiary of the US' FW Woolworths company. The company came under British ownership in 1982, and outlasted its US parent, which closed in 1997.
|
|
|
|
|
|
Print this Story
