Deathwatch: More stores and jobs axed at Ethel Austin - but just how unhappy are the adminstrators?

25 February 2010

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retaildeathwatch Struggling cut-price fashion retailer Ethel Austin has sunk further into the mire with the news that administrators MCR are closing 114 stores by the end of the week, with the loss of over 1,000 jobs.

469 distribution and head office staff were also laid off earlier in the month. A spokesman for MCR said that the chain’s remaining 162 stores would continue to operate as usual while he looked for a buyer for the rest of the business as a going concern.

But the question as to how many companies really need to go into administration is continuing to be asked. Private Eye recently reported on the financial fall out from the collapse of Woolworths in late 2008, highlighting a major conflict of interest.

The Eye claim that when Woolies got into trouble, their chief executive Steve Johnson hatched a plan to prevent administration by selling the stores to a “turnaround specialist” company, Hilco. This plan was rejected by Woolworth’s banks’ advisor, Deloitte and the banks duly put Woolies into administration. The administrators who got the job of grinding Woolworths into the dirt? That would be Deloitte.

The recent publication of the Woolworths administration report shows that the banks were repaid everything they were owed in full and Deloitte’s three partners and their staff got £9.3 million for their hard work. Even poor Hilco got a piece of the tragic action, pocketing £8.44 million as advisors to the administrators.

Oh, but what of the thousands of staff who lost their jobs over the Christmas 2008? They received the bare legal minimum statutory redundancy pay, averaging a week’s wages per year of service. Ouch.

TOPICS:   High Street News

6 comments

  • Nobby
    What's going to happen to Little Willie?
  • James
    That is an outrage really. But it always happens. Company goes bust, small pot of money is available, first hand outs go to the administrators who earn insane money for not a great deal of work.
  • Tom P.
    The Boots.com site has been down since 1pm, wonder if vultures are going to find more rich pickings?
  • andyofyarm
    That's how business law works,creditors come before jobs.There's a good reason for this if jobs come before creditors no fucker gets their bills paid and there are more not less business failures. Coming up next on companies in administration...football clubs
  • erm
    Let's not play some silly game that Woolies was a sound business thrown to the dogs.It was a pile of shit, The executives will do anything to avoid adminstration to keep them in beemers for as long as poss.
  • teardropali
    Why dont you grow up "erm" or who ever you are, Woolworths was around for nearly 100 years! so at some point it must had been doing something right! Super markets and copy cat retailers put the final nail in Woolies coffin! Just have a thought for those poor 30,000 employees who lost their jobs! for most, Woolies was their lives! I personally loved Woolies and even a year on I miss it terribley and no matter what you or any way else thinks I feel it has left a huge gap on the high street, and it should never have happened, closing down over 800 stores and 5 distribution centres! criminal, someone needs to take responsibility! and you need to think before you spout off about something you clearly no nothing about!!

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