The former bosses of collapsed retailers Woolworths and MFI have been parachuted in to help turn around embattled Allied Carpets, which was bought out of pre-pack administration last week.

Steve Johnson, previously Woolworths chief executive, and Gary Favell, who held the same role at MFI, have been retained by Allied Carpets backer Valco, the private equity arm of restructuring specialist Hilco.

Woolworths collapsed last November, ending a near 100-year presence on UK high streets, three months after Johnson’s arrival. Its demise was preceded 24 hours before by MFI’s, which was put into administration by Favell twice in the space of two months. 

The duo have associations with Hilco, which was a backer of MFI and ran Woolworths’ closing down Sale.

It is unclear whether the pair will take on executive responsibilities or advise. However, sources close to Allied Carpets said Favell was likely to take on a “senior management role” while Johnson could become chairman.

An Allied Carpets spokesman said: “Valco is reviewing the management team structure. No appointments have been made yet.” He confirmed that present chief executive Clive Hutchings will remain in the role until a replacement is found, and will then head insurance division Allied Carpets Inspections.

Despite their association with such high-profile retail collapses, observers said that Johnson and Favell could bring some valuable expertise to the ailing retailer.

Retail Knowledge Bank senior partner Robert Clark said: “There must clearly be some question marks but, in Johnson’s case, he came into the Woolworths situation when it was probably beyond redemption.”

Allied Carpets collapsed into administration last Friday after suffering in the torrid floorings market.

Investor Hilco then backed new company Allied Carpets Retail, which bought 51 of Allied’s 217 stores and is negotiating for more.

Other retailers interested in taking stores include rivals Carpetright and United Carpets.

Carpetright finance director Neil Page said the number likely to be of interest is in “single digits”. He said: “We’re not looking at taking a massive number as the pre-pack pulled out the best ones and we’ve got good coverage of the UK already.”

It is thought United Carpets may want as many as 20 stores. United Carpets finance director Ian Bowness declined to comment on an exact number but said: “We are interested in some of the sites.”

Ian Parish, director at BNP Paribas Real Estate, the property agent acting for administrator BDO Stoy Hayward, said that he had been “flooded with enquiries” from out-of-town retailers.

No comment was available from Favell, Johnson or Hilco.