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Faith on the brink of administration

Footwear retailer Faith is expected to go into administration this evening.

It is understood that Heath Sinclair of Mazars is on standby to be appointed administrator of Faith but he declined to comment.

The retailer is teetering on the brink of administration despite hoisting the for sale sign last month and a flurry of interest from parties including private equity houses Epic and Endless and trade players such as Sports Direct.

However hopes of a sale appear to have been dashed and the administrator is now expected to review options for Faith, which may still lead to a sale of all or part of the business.

Since this morning speculation has mounted regarding the future of Faith, prompting suppliers to the chain to threaten to pull stock from Faith stores and Faith concessions in Debenhams.

Faith has 78 shops and 120 concessions, mainly in Debenhams. Entrepreneur John Kinnaird bought it out of administration in 2008. It was once owned by private equity firm Bridgepoint, which paid £64m for the business in 2004.

Until today market sources believed that restructuring specialist Hilco was in pole position to buy Faith. However a source familiar with the situation said: “Hilco does not hold the tiller, it does not have control. It will be up to the administrator to make the key decisions.”

One source believes that Debenhams influence may be pivotal to the outcome, because of change of ownership clauses affecting Faith concessions.

Debenhams, which bought the Principles brand from administration, will be eyeing the Faith situation closely. One source said Debenhams could possible buy the Faith brand name.