Wine specialist Oddbins has applied to go into administration to protect the business from creditors’ claims, ahead of a crucial meeting this week to decide on its future.
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On Friday, Oddbins applied for administration as a precaution against anyone seeking to wind up the company ahead of a meeting which is planned for this Thursday (March 31). The action means the retailer will win a 10-day “moratorium” in which no claims against it can be processed.
At the meeting, creditors will vote on whether to approve a company voluntary agreement (CVA), which would allow Oddbins to reorganise its debts and shut some shops.
As part of the CVA, Oddbins wants to close a third of its stores - 39 altogether - and its London head office, resulting in 120 job losses. Creditors will also be offered some payment from a £4.7m compensation pot.
The retailer has also asked for rent on the remaining 89 shops to be cut by 30% and paid in monthly rather than quarterly instalments.
If landlords vote in favour of the CVA, the proposed pay-out equates to about 21p in the pound.
Oddbins is the latest casualty in a long line of off-licence groups to have struggled against the rise of the supermarkets and fall-out frm the downturn. Unwins collapsed in 2005 with debts of more than £30m and First Quench, owner of Threshers and Wine rack, went into administration in 2009.