Woolworths and MFI enter administration
Troubled retailers Woolworths and MFI have fallen into administration, putting thousands of jobs at risk.
Woolworth’s retail division has 815 stores and employs 25,000 people across the country. The news of Woolworth’s administration came as another big name, furniture giant MFI, called in administrators, threatening a further 1,000 jobs.
It is understood that all of Woolworth’s stores will continue to operate as normal, and staff will be paid this month's wages. But the news is bleaker for MFI’s employees, as 26 stores have closed immediately with the loss of around 260 jobs.
A statement from MFI said: “The administration follows the continuing pressure on the home market, which has accelerated in recent weeks with sales levels falling further behind prior year levels.”
Usdaw, the shopworkers’ union, which represents thousands of members in Woolworths and MFI, is disappointed by the news.
John Gorle, Usdaw’s national officer, said: “This is devastating news for our members. We will be seeking urgent talks with the administrators to ensure that our members’ future is at the top of their agenda.”
“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.”
However, it is hoped that Woolworths can be saved.
Dan Butters, reorganisation services partner at Deloitte said that it was looking for a suitable buyer for all parts of the business. “In the last 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 currently has debts totalling £385 million and had tried to sell up for a nominal price of £1 earlier this month, with the restructuring firm Hilco rumoured to be the potential buyer. Any takeover is expected to involve job cuts.
Many high street retailers are feeling the pinch as consumers cut back their spending, slashing prices in an effort to get customers through the door. Around 30 high-street chains have gone bust this year so far, including the shoe retailer Dolcis and soft furnishings trader Rosebys.