Edinburgh Woollen Mill Group, the owner of Jaeger, Peacocks and Austin Reed, is teetering on the brink of administration putting up to 24,000 of jobs at risk.
The group, controlled by entrepreneur Philip Day, has filed a notice of intention to appoint administrators, a legal document which provides protection from creditors for 10 days. The group had been seeking a buyer and will spend the next few weeks considering its options.
Edinburgh Woollen Mill (EWM) said it was “responding to the harsh trading conditions caused by the impact of the Covid-19 pandemic and a recent reduction in its credit insurance”. .
It said it had received a number of expressions of interest for parts of the group in recent weeks and these were being assessed along with “all other options”.
However, the chief executive of EWM, Steve Simpson, said there would “inevitably be significant cuts and closures” and the group would appoint FRP Advisory as administrators to carry “necessary restructuring” of the business.
Simpson said: “Like every retailer, we have found the past seven months extremely difficult. This situation has grown worse in recent weeks as we have had to deal with a series of false rumours about our payments and trading which have impacted our credit insurance.
“Traditionally, EWM has always traded with strong cash reserves and a conservative balance sheet but these stories and the reduction in credit insurance – against the backdrop of the initial lockdown, current local lockdowns, and the second wave of Covid-19 reducing footfall have made normal trading impossible.
“As directors we have a duty to the business, our staff, our customers and our creditors to find the very best solution in this brutal environment.”