High street chain Kookai to close
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Kookai, the high street fashion chain, has gone into administration, becoming the latest casualty of the retail slowdown and putting the future of 600 jobs under threat. The collapse of Kookai in the UK came as further evidence emerged that Christmas brought little cheer to many retailers. The gloom was reflected on the stock market, where Tesco, Marks & Spencer and GUS were the three biggest fallers in the FTSE 100 index, with M&S down 8 to 497p, falling back through 500p.
Many had hoped the retail sector had survived Christmas relatively unscathed. Hopes were fuelled by John Lewis reporting a bumper Christmas and a surge of shopper numbers on Boxing Day.
Kookai's future in the UK had been in the balance for some time. Forminster, the company listed on the Alternative Investment Company which operated the licence to use the Kookai name in the UK, failed to re-negotiate the rights to the brand last month.
Its shares were suspended. The row with Vivarté, the French company which owns the brand, led to a shortage of clothes being shipped to the UK. Neville Kahn, partner at Deloitte, the joint administrator, said: "Trading pre-Christmas stood up very well but was hampered by there not being enough clothes on hangers."
He said the shops will remain open and he hopes to find a trade buyer for the 25 leasehold sites and 30 concessions "within weeks". The company owes £8m to its creditors, mostly landlords and suppliers, principally Vivarté. Mr Kahn said that he had negotiated with Vivarté to ship extra clothes for the January sales.
Most retail experts say Kookai's demise does not herald a spate of bankruptcies on the high street. However, Richard Ratner, analyst at Seymour Pierce, said he was unnerved by how weak trading had been in recent days. "I don't like the smell of it," he said, and reckoned trading across the sector had "fallen off a cliff" since last week.
SPSL said shopper numbers were down by 10.9pc over the weekend compared with the same period last year.
Source: The Daily Telegraph