Peacocks rescued out of administration

After a month of speculation ailing high street retailer Peacocks has finally found a buyer. Edinburgh Woollen Mill has rescued the value chain out of administration with a debt of £750m, saving 6,000 jobs but seeing 3,100 staff made redundant.

The deal will include the acquisition of 338 stores, 57 concessions, three distribution centres and the head office, said Edinburgh Woollen Mill.

But 224 stores have ceased trading with immediate effect. The announcement was made by KPMG, joint administrators of Peacocks, who were called in in January.

Joff Pope, joint administrator and associate partner at KPMG, said the deal would ensure 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," he said. Peacocks, with 611 stores and 49 concessions across Britain, had employed 9,100 people.

About 250 staff at the group's Cardiff HQ lost their jobs following the move, and there will be another 16 job losses in the city after Wednesday's sale - leaving around 250 staff.

Mr Pope said like many other retailers, Peacocks suffered from a decline in consumer spending due to the tough economic conditions.

"This, combined with a surplus of stores and unsustainable capital structure, led to the business becoming financially unviable," he said. But he added that the chain's strong brand presence and loyal customer following meant that Peacocks attracted a great deal of interest from both trade and private equity bidders.

And he thanked the chain's management team and staff for their continued assistance "in very difficult circumstances". 'Rebuild'

Philip Day, chairman and chief executive of the Edinburgh Woollen Mill Group, based in Langholm in Scotland, said: "We look forward to working with our new colleagues to rebuild the business in what is a very tough economic environment for High Street retailers in the UK."

Mr Day said he hoped there would be scope to save more jobs and stores from those being forced to close due to performance issues and overhead pressures.

Image: Peacocks