The rising cost of raw materials has forced discount menswear chain Officers Club into administration, but young fashion chain Blue Inc has saved half of its stores.

The retailer has appointed Grant Thornton UK partners Joe McLean and Les Ross as joint administrators.

The administrators to the chain, which employs 900 people across 102 stores, sold 46 stores to Blue Inc immediately following their appointment, saving 400 roles at the chain. The remaining 56 stores and the Officers Club warehouse in Newcastle have been closed.

McLean said: “The company experienced particularly challenging trading conditions in 2010 with raw material costs rising significantly. It was not possible to pass these increases on to customers given the extremely price sensitive nature of the UK retail arena.”

McLean added: “The directors did not see any improvement forthcoming in the early months of 2011 and, mindful of their legal responsibilities, concluded reluctantly that administration was in the best interests of the company’s creditors and other stakeholders.”

Retail Week reported this morning that the purchase would take Blue Inc into Scotland where it has no shops and will also strengthen its franchise in the North-east of England and Wales, where it has three and two stores respectively.

The stores being bought are expected to add between £25 and £30m of sales to Blue Inc’s turnover, bringing its revenues up to about £80m.

It had previously been reported that Blue Inc would also buy the Petroleum chain from Officers Club but this does not form part of the deal.