Edinburgh Woollen Mill, the retail group controlled by billionaire tycoon Philip Day, is poised to collapse into administration.
EWM Group, the owner of businesses and brands including Peacocks and Jaeger as well as the eponymous chain, has filed a notice of intention to appoint administrators at the High Court. The development was first reported by PA, potentially affecting 24,000 jobs.
The retailer said the decision was in response to “the harsh trading conditions caused by the impact of the Covid-19 pandemic and a recent reduction in credit insurance”, which had prompted it to initiate “a review of its businesses in a drive to secure their future”.
EWM said the notice to appoint administrators would give it “breathing space” to consider its next steps. There have been expressions of interest in recent weeks for parts of the business, which are being assessed, along with “all other options”.
FRP Advisory will be appointed as administrators “at the end of this process [and] will carry out the necessary restructuring of the wider business”.
EWM chief executive Steve Simpson said: “Like every retailer, we have found the past seven months extremely difficult. This situation has grown worse in recent weeks as we have had to deal with a series of false rumours about our payments and trading which have impacted our credit insurance.
“Traditionally, EWM has always traded with strong cash reserves and a conservative balance sheet but these stories and the reduction in credit insurance – against the backdrop of the initial lockdown, current local lockdowns and the second wave of Covid-19 reducing footfall have made normal trading impossible.
“As directors, we have a duty to the business, our staff, our customers and our creditors to find the very best solution in this brutal environment. We have applied to court today for a short breathing space to assess our options before moving to appoint administrators.
“Through this process, I hope and believe we will be able to secure the best future for our businesses but there will inevitably be significant cuts and closures as we work our way through this.”