Thousands of jobs were at risk today after administrators were called in at budget retailer Ethel Austin and the chain’s sister company, home interiors specialist Au Naturale.

Ethel Austin, one of the UK’s value clothing retailers, has a network of nearly 300 stores, including outlets in Bilston, Darlaston, Wednesbury, Walsall, West Bromwich, Dudley, Rowley Regis, Cradley Heath, Perry Barr, Smethwick and Birmingham.

There are Au Naturale stores in Merry Hill and in Walsall.

Administrators hope to sell the businesses as a going concern, but said: “In the current economic climate there are no guarantees that purchasers will be found.”

Ethel Austin was established more than 70 years ago and has grown to become one of Britain’s leading value businesses, with its headquarters on Merseyside, just 10 miles away from where the business was founded by Ethel Austin herself.

Geoff Boucher, partner in administrators MCR, said: “The joint administrators are trading the companies in administration in the short term with a view to finding a purchaser for the businesses as a going concern. In the current economic climate there are no guarantees that purchasers will be found.

“We are reviewing the financial position of the companies and are at this stage unable to rule out store closures and redundancies. There is no doubt in our mind that the onset of the global economic crisis has hit the retail sector particularly hard. As a consequence of this the companies have struggled to secure funders, which in turn has impacted their ability to generate sales revenue.