Blacks Leisure could face a post Christmas administration and break-up following Sports Direct’s decision not to buy the business.
Bids for the retailer are due in on Thursday however people close to the situation told the Sunday Times that the most likely outcome will be administration followed by a CVA.
It is believed that rival outdoor specialists Mountain Warehouse, Go Outdoors and Cotswolds are lining up to take the pick of the offloaded stores.
However Go Outdoors is still mulling buying the firm. Founder of the chain Paul Caplan told the Sunday Telegraph it is in talks with KPMG but there is no certainty it will make an offer for any or all of the Blacks business.
Meanwhile the newspaper reported that restructuring specialist Hilco is understood to be interested in buying the trading business if it falls into administration, or a pre-pack administration is used.
Hilco is yet to access any information from KPMG, which is running the sale process.
Despite Sports Direct’s decision not to buy the Blacks business as a whole, it is known to still be interested in looking at particular brands in the event of a break-up or pre-pack administration.
Blacks put itself up for sale earlier this month as plans to raise fresh capital to enact its turnaround plan, put together by new chief executive Julia Reynolds who took the helm of the struggling retailer in August, failed.
The retailer’s like-for-like plummeted 7.2% in its first half to August 27 and, when it revealed its interims in October, the retailer said they had plunged by 14.2% since the end of the period.
The outdoor specialist, which has debts of £36m, reported that losses before tax had widened from £7.2m to £16m in its first half.