Claire’s and The Original Factory Shop due to enter administration
The parent company of Claire’s and The Original Factory Shop (TOFS) is preparing to enter the two retailers into administration. Private equity firm Modella Capital said the current climate was “extremely challenging” for high street retailers, particularly due to “an alarming drop-off in pre-Christmas footfall”.
In a statement to The Guardian, the firm ultimately concluded that an administration was the “only option” for Claire’s and TOFS, with insolvency proceedings currently underway.
It is reported that advisory firm Kroll will oversee the proposed administration of Claire’s, which could impact around 1,350 jobs. Meanwhile, Interpath is being lined up to handle TOFS, with approximately 1,200 jobs at risk. Both retailers have filed a notice to appoint administrators with the high court, giving them 10 days breathing space.
FashionUnited has contacted Kroll with a request to comment. Interpath declined to comment.
“Neither has a realistic possibility of trading profitably again…”
Speaking to The Guardian, Modella said the decision had been tough. It added: “We have worked intensively in an effort to save both businesses, having made last-ditch attempts to rescue them, but neither has a realistic possibility of trading profitably again.
“A combination of very weak consumer confidence, highly adverse government fiscal policies and continued cost inflation is causing many established and much-loved businesses to suffer badly.”
Modella snapped up 156 of Claire’s over 300 UK and Ireland stores last year, rescuing around 1,000 jobs at the time. While the future of the remaining locations is still in limbo, the partial sale came alongside separate processes for its North American and French businesses, both of which have found new owners amid bankruptcy proceedings.
TOFS, meanwhile, has undergone its own restructuring after Modella acquired the retailer earlier last year. The company went on to initiate a CVA, resulting in a series of store closures and rent cuts.
Edited 06/01/25, 10:00am CET. A spokesperson for Modella Capital has now issued a full statement to FashionUnited: "Very sadly, we have had to initiate insolvency proceedings for The Original Factory Shop (TOFS) and Claire's Accessories UK & Ireland. This has been a very tough decision.
"We have worked intensively in an effort to save both businesses, having made last-ditch attempts to rescue them, but neither has a realistic possibility of trading profitably again. In these circumstances, Administration is the only option. In both cases, the legacy effects of trading prior to our ownership left them highly vulnerable.
"The climate on the High Street remains extremely challenging, and TOFS and Claire's are not alone in experiencing difficulties. This is borne out by recent Sensormatic statistics and other data sources suggesting an alarming drop-off in pre-Christmas footfall.
"A combination of very weak consumer confidence, highly adverse government fiscal policies and continued cost inflation is causing many established and much-loved businesses to suffer badly. It’s a simple fact that if retailers can’t make money, they risk having to close – and jobs across the country are lost."
OR CONTINUE WITH