Update - UK: First Quench store closures loom
Redundancies and store closures loom at First Quench Retailing, the collapsed owner of the Threshers off-licence chain, but management is hopeful a buyer will be found for the business.
First Quench, which employs more than 6,000 people, confirmed last night that it had called in KPMG as administrator for the stricken business.
All of the group's 1,202 off-licences remain open today (30 October), but KPMG warned this morning that it will struggle to save all jobs and stores.
"Unfortunately, it is likely that some store closures and further redundancies will be made," said KPMG. "Once the administrators have assessed the viability of each store, a further communication will be announced."
KPMG is seeking to sell the business as a going concern and just-drinks understands from a source familiar with the situation that management is "hopeful" that a buyer can be found.
It is thought, however, that the business is most likely to be broken up between several different buyers, rather than be sold in bulk to one suitor.
First Quench, which alongside Threshers owns Wine Rack and The Local stores, as well as Haddows in Scotland, has struggled to fend off the effects of recession in the UK. In June this year, the group saw credit lines withdrawn.
"Trading in the off licence sector has become increasingly competitive in recent years, with the recession proving too much of an additional burden in this case," said Richard Fleming, head of restructuring at KPMG.
"The business has a comprehensive geographic footprint, however, and we believe this presents a compelling opportunity to other retailers who may wish to extend their reach."
For just-drinks' analysis of First Quench Retailing's demise, click here.
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