Staff a high street retailer Woolworths have been reassured they will be paid their salaries in full tomorrow, despite the company going bust.
Professional services firm Deloitte has been appointed administrator to the 99-year-old retailer and Entertainment UK, the wholesale division of Woolworths Group.
Neville Kahn, reorganisation services partner at Deloitte, said: “Woolworths has suffered a number of cashflow problems. Strenuous efforts over recent weeks to keep these companies going have unfortunately failed and the businesses are now looking to be rescued under the administration process. The companies were placed into administration this morning and will continue to trade. Stores will remain open past Christmas and employees in stores will be paid.”
Kahn confirmed that Hilco had been appointed to assist in the management of the retail business. He added: “We appreciate the co-operation and support from the management and staff at both companies. We are glad that arrangements are in place to ensure that all wages will be paid in full this week.”
The retail arm of the company operates out of some 800 high street stores and four distribution centres, employing 25,000 staff. Entertainment UK is the UK’s leading distributor of entertainment products.
Dan Butters, another reorganisation services partner also on the Deloitte team, said: “We will be looking for a suitable buyer for all parts of the business. In the past 24 hours we have received expressions of interest from a number of parties for both the retail and wholesale businesses. We are working hard to ensure that any sale of the business, in whole or part, will preserve jobs.”
Woolworths’ joint venture with BBC Worldwide – publisher 2 Entertain – has not been put into administration. The BBC reported the firm remained in talks to sell 2 Entertain to BBC Worldwide, the BBC’s commercial arm.