Everybody was braced and ready for something to happen at Clintons, but when the news broke yesterday (December 4) that the UK’s second largest retail specialist had effectively been sold back to its owners in a pre-pack administration deal, it was not the early Christmas present the trade had wanted.
While the deal means that the chain’s 334 stores can continue to trade through the Christmas season, and safeguards the jobs of Clintons’ 2,500 staff in the festive run-up, it does leave a question mark over the outstanding monies owed to suppliers, including a number of greeting card publishers, giftwrap companies and calendar manufacturers. Suppliers are still to be informed as to what is to happen to monies owed from stock that was shipped to Clintons stores prior to the administration as well as the terms for future stock requirements. While greeting cards are supplied into Clintons via brokerage from UKG, other products are supplied direct.
What happened yesterday was that Clintons went into administration, but was then immediately sold to Esquire Retail, a new company owned by the Weiss family. The Weiss family acquired Clintons seven years ago when the retailer went into administration. (At that time the Weiss family fully owned UKG and acquired Clintons to protect its debt and safeguard a supply chain for its card publishing interests).
This latest development comes three months after it was announced that Clintons was being put up for sale, with KPMG appointed to explore options.
“Like so many of our fellow high street retailers, we have worked tirelessly to contend with the maelstrom of issues impacting the sector, from business rates pressures, to fragile consumer confidence and the lack of clarity around the taxation of online retail businesses,” said Eddie Shepherd, ceo of Clintons.
Despite bids being received to buy the Clintons business from those both within the trade and outside, these were not accepted. The next option taken was to negotiate with landlords about the launch of a company voluntary arrangement (CVA), which would have needed support from at least 75% of creditors to go through.
“Despite receiving support from a number of landlords, we were unfortunately unable to secure the requisite support needed to successfully launch our proposals.” He said that “With no other investment options available, we therefore had to take the difficult step to place the company into administration.”
Top: The deal sees Clintons stores continue to trade.
