Peacocks has been sold to Edinburgh Woollen Mill, following weeks of negotiation with administrator KPMG.
Edinburgh Woollen Mill, which pulled out of the bidding race on February 9 and re-entered last weekend, has snapped up the Peacocks brand, 388 stores and concessions, as well as Peacocks head office and distribution centre in Wales.
The deal, although saving around 6,000 jobs, will mean redundancies for 3,100 staff and the closure of 244 stores.These have ceased trading with immediate effect. At head office, there will be 16 more redundancies.
Chris Laverty, joint administrator and restructuring partner at KPMG, said in a statement: “Today’s deal ensures the continued trading of a well known name on the high street. While it is unfortunate that redundancies have been necessary, we are pleased that we have been able to preserve the majority of the business and jobs.”
“Like many other retailers, Peacocks suffered from a decline in consumer spending due to the tough economic conditions and this, combined with a surplus of stores and an unsustainable capital structure led to the business becoming financially unviable. However, a strong brand presence and loyal customer following meant that Peacocks attracted a great deal of interest from both trade and private equity bidders, leading to today’s successful sale.”
Yesterday, administrator KPMG had two bidders: Edinburgh Woollen Mill, which re-entered talks last weekend, and Indian apparel firm SKNL. Both had been in discussions to buy part, or all, of Peacocks, which went into administration last month.
Edinburgh Woollen Mill made a surprise u-turn by returning to discussions, having pulled out of the bidding process on February 9.
Almost half of Peacocks’ head office staff was made redundant in January. The 249 redundancies at the Cardiff office brought the total staff number at Peacocks down to 9,351. The staff has been campaigning since to ensure that a buyer will keep the firm’s headquarters in Cardiff, as well as setting a sound financial structure for the company.
Edinburgh Woollen Mill acquired the bulk of Jane Norman stores via pre-pack last year, and has recently considered Blacks Leisure, which was sold to JD Sports.