High street retailer, BHS, collapsed into administration yesterday, April 25, putting 11,000 jobs at risk and threatening the closure of up to 164 stores.
It is the biggest retail failure since Woolworths went bust in 2008.
Administrators Duff & Phelps said last-ditch talks to find a buyer for the firm over the weekend had failed, adding: “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.”
It added that BHS would continue to trade as usual while potential buyers are sought.
The company’s owner, Dominic Chappell, said he will continue to work with the administrators to “find a solution post the administration”.
BHS was bought last year by a consortium called Retail Acquisitions, headed by Mr Chappell, for just £1 from retail entrepreneur Sir Philip Green, the owner of the Arcadia retail empire.
BHS has debts of more than £1.3 billion, including a pension fund deficit of £571 million, which proved a major stumbling block in the rescue talks.
The Government has said that shoppers must show loyalty to BHS in a bid to help the ailing department store chain.
Business Minister, Anna Soubry, said BHS has suffered as a result of changing habits which have resulted in people opting to shop around on the high street and elsewhere, including online.
Ms Soubry said: “It’s the old story – you don’t know what you’ve got until it’s gone, and unfortunately BHS is one of those retail chains that has suffered in many ways due to the presence of online sales, but also from the lack of sort of support that people traditionally had.
“All of us who are old enough to remember, we would always shop in the same sorts of places. Those days have gone, there isn’t that sort of loyalty.
“But here is a perfect opportunity – the shops are still open, still taking vouchers, so if you’ve got BHS vouchers please go and spend them and support the staff and, as ever, support the Great British high street.”