ADMINISTRATORS of troubled retailer Clinton Cards have confirmed that ‘a number of stores will be closed’, leaving jobs at risk at Louth’s branch.
As reported on the Leader website yesterday, the card retailer was plunged into administration by its largest supplier American Greetings Corporation after reported losses of £130 million since 2004.
The announcement leaves uncertain futures for staff at Louth’s large Market Place store, as well as the 8,000 UK-wide staff at the 750 plus outlets.
It is understood the threat of online outlets like Moonpig and Funky Pigeon as well as cheaper supermarket card sales have plunged Clinton Cards into trouble.
Now it appears only a similar takeover to that of clothing retailer Peacocks by Edinburgh Woollen Mill in February will be enough to prevent shops being closed.
Administrators Peter Saville, Simon Freakley and Anne O’Keefe, Partners at Corporate Advisory and Restructuring specialists Zolfo Cooper, said in a statement today (Thursday): “Recently, Clintons has been faced with extremely challenging trading conditions, particularly in its Birthdays subsidiary, where the combined cost to the Group in terms of acquisition cost and accumulated losses is estimated to have been in excess of £130 million since 2004.
“Despite evaluating ways to restructure its business, Clintons was unfortunately unable to secure adequate support or funding for its restructuring plans. The challenging business environment, and in particular the increased competition for greetings cards and related products, meant that the Group required radical restructuring and administration was the last remaining option available.
“Our first priority is to stabilise the business and assess its financial position. We will continue to trade the business whilst we undertake a full marketing exercise to find buyers for all or parts of the Group so that the best possible outcome can be achieved for stakeholders.
“It is likely that a number of stores will need to be closed in order to make the business financially viable. However, Clinton Cards and Birthdays are very well-known brands on the high street and we believe that there is a strong underlying core business.
“We are therefore confident that it is an attractive proposition for a range of potential buyers and welcome expressions of interest from third parties.”
Clinton Cards, formed in 1968, is the UK’s largest specialist retailer of greetings cards and related products, and is listed on the London Stock Exchange.
The Joint Administrators were appointed after the group experienced cash flow problems due to ‘extremely challenging’ trading conditions.
Following appointment, the Joint Administrators will continue to trade the group while exploring all possible options for its future including a sale of all or parts of the business.
Speed Communications, media company for Clinton Cards, are unable to release information about specific stores at this stage.
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