- My Local could appoint administrators as early as next week
- If it were to collapse, Morrisons could be liable for £20m of costs related to leases that would revert back to it
- It would be the third retail collapse in two months following BHS and Austin Reed
My Local, the convenience chain born from the ashes of Morrisons’ c-store estate, has filed an intention to appoint administrators, putting 1,658 jobs at risk.
KPMG has been lined up to handle the potential administration and could be formally appointed as early as next week, sources told Retail Week.
Retail Week revealed last week that administration was on the cards for My Local after the grocer hired KPMG to explore options.
However, while administration is the likely outcome, that course of action could still be averted and management is working to save the company, it is thought.
If the retailer were to collapse, a portion of the store leases would revert to Morrisons, which retained a guarantee on the shops when it sold them to My Local.
At the time of the deal it was estimated that the liability of the store leases could cost Morrisons up to £20m, although sources have suggested that figure could be somewhat higher.
My Local would be the third retail administration within two months, following the collapse of both BHS and Austin Reed.
My Local was set up in October 2015 by entrepreneur and star of The Secret Millionaire Mike Greene, who, backed by Greybull Capital, acquired Morrisons’ convenience arm to launch his own c-store business.
It is thought to have suffered challenging trading in recent months as the tough grocery market combined with the impact of the living wage hit performance.
The collapse would put 1,658 jobs at risk. The grocer initially recruited 2,300 people when it launched but as staff left the business they were not replaced.
Usdaw National Officer Joanne McGuinness said My Local staff are “devastated” at the news. “Having been sold by Morrisons last year, there was a mood of optimism that the new owners could turn around the business,” she said.
“We are talking with the company in a bid to save jobs and get the best deal for staff. In the meantime Usdaw is providing the support, advice and representation they need at this unsettling time.”
My Local and KPMG declined to comment.