United Carpets sold in pre-pack administration deal
David Robert Acland and Lila Thomas of Begbies Traynor were appointed yesterday as joint administrators to United Carpets Northern, the principal trading arm of United Carpets Group. The business and the majority of its assets were then sold to a wholly owned subsidiary of the group, United Carpets Franchisor. The deal included the purchase of 72 stores, two warehouses and the company’s head office site.
The sale has raised fears of job losses as the company warned that a number of stores could close if talks with landlords regarding rent reductions were unsuccessful. The stores employ 400 workers.
In a statement the company said: "The appointment of the joint administrators followed a review of the business which concluded that without substantial rent reductions a [significant] number of the corporate and franchised stores would be unable to continue to trade.
"Efforts to agree reductions with landlords were not successful. United Carpets (Franchisor) Ltd will now seek to agree appropriate rents with landlords and, if necessary, will close those stores where agreement cannot be reached.
"The board is disappointed at the need to take these steps but is confident that the core of locations remaining once the restructure is concluded will, with appropriately adjusted overheads, provide the foundation for a successful and sustainable business."
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