Maplin sinks into administration with 2,500 jobs at risk
Electronics retailer Maplin has collapsed into administration, putting 2,335 jobs at risk.
Bosses today blamed the impact of Brexit on sterling, 'a weak consumer environment' and the withdrawl of vital credit insurance for its fate.
The company's owners, Rutland Fund Management, had been struggling to find a buyer but was unable to strike a deal to save the business. Edinburgh Woollen Mill had been in talks to buy the business but wanted Rutland to retain a stake and have a say in how Maplin was run.
Maplin says it will continue to trade from its 217 stores – including branches in Wolverhampton, Brierley Hill, Cannock, Kidderminster, Walsall and Stafford – while administrators from PwC try to find a buyer for all or parts of the business.
The administrators from PwC say there are no immediate plans to close any stores or make any redundancies, "although this will remain under review".
They said they wouldl continue to trade the business, "whilst we explore all opportunities to find a new owner". Outstanding customer orders will be delivered as usual. The administrators say they are currently assessing the status of gift cards. In the meantime they will continue to be honoured in stores and online.
Maplin’s CEO, Graham Harris, said this morning: “I can confirm this morning that it has not been possible to secure a solvent sale of the business and as a result we now have no alternative but to enter into an administration process. During this process Maplin will continue to trade and remains open for business.
"The business has worked hard over recent months to mitigate a combination of impacts from sterling devaluation post Brexit, a weak consumer environment and the withdrawal of credit insurance. This necessitated an intensive search for new capital that in current market conditions has proved impossible to raise. These macro factors have been the principal challenge not the Maplin brand or its market differentiation.
"We believe passionately that Maplin has a place on the high street, and that our trust, credibility and expertise meets a customer need that is not supported elsewhere.
"We will now work tirelessly alongside Zelf Hussain, Toby Underwood and Ian Green, from PWC, who have been appointed as the as Joint Administrators of Maplin Electronics Limited, to achieve the best possible outcome for all of our colleagues and stakeholders.”
Maplin started 40 years ago and its website offers more than 30,000 electronic, computing and media products. The company had annual turnover of £235.8 million but it need to find extra cash to pay mounting debts.
PwC's Zelf Hussain, Toby Underwood and Ian Green have been appointed joint administrators.
They said the company had experienced a decline in performance as a result of the softening of consumer demand in what has been a challenging retail environment and higher-priced (US denominated) products. "A solvent sale of the business had been pursued by management in recent weeks but unfortunately could not be concluded. Given the cash position of the company, the directors resolved to put Maplin into administration."
Zelf Hussain said: “The challenging conditions in the UK retail sector are well documented. Like many other retailers, Maplin has been hit hard by a slowdown in consumer spending and more expensive imports as the pound has weakened.
“Our initial focus as administrators will be to engage with parties who may be interested in acquiring all or part of the company. We will continue to trade the business as normal whilst a buyer is sought.
“Staff have been paid their February wages and will continue to be paid for future work while the company is in administration.”