27/11/2008

Woolworths Enters Administration

High Street retailer Woolworths has entered administration, leaving thousands of jobs at risk.

The chain, which has 815 stores in the UK and employs around 30,000 staff, had been struggling with debts totalling £385 million.

A statement issued by Woolworths Group confirmed that Woolworths and the Entertainment UK wholesale business could no longer be operated as a going concern. However, the statement also said that Woolworths Group is not in administration and remained in discussions with BBC Worldwide regarding the possible sale of its 40% interest in publishing venture 2 Entertain.

Adminstrators Deloitte said that the company's retail stores would remain open until after Christmas and employees in stores would be paid.

The firm also said that there had been "expressions of interest" for both the retail stores and the Entertainment UK business.
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The shopworkers' union, Usdaw, described the news as "devastating". John Gorle, Usdaw National Officer, said: "We will be seeking urgent talks with the administrators to ensure that our members' future is at the top of their agenda and to understand the proposals for the businesses in the short to medium term.

"Obviously, the ongoing uncertainty surrounding the future of the stores will be of great concern to employees, so we will do everything we can to help communicate the situation to the staff as the situation unfolds.

"Many of the staff have served the companies for many years and are extremely dedicated and loyal and we will be doing everything we can to help them through this difficult time."

Prime Minister Gordon Brown stressed that the government is working to ensure that Woolworth stores remained open over Christmas, saying that arrangements had been discussed to ensure that employees would receive their wages and that those threatened with redundancy would be helped to find alternative employment.

Meanwhile, furniture retailer MFI has also gone into administration. The company is continuing to operate at present and stores will remain open, although only display stock will be sold.

(KMcA)


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