27th June 2011
The chain is likely to be put into pre-packaged administration – a controversial practice explained by the Guardian here.
"The practice involves selling the assets of a company immediately after it has entered administration, which some experts claim generates a greater return as business continuity and the goodwill of the company are preserved. However, pre-packs have also attracted criticism because many feel the company merely continues to operate as usual while jettisoning legitimate creditors. For example, the deal that saved Cobra beer in 2009 left creditors with debts of £71m."
A consortium of banks had previously appointed PricewaterhouseCoopers to sell on the business but it did not succeed in finding a buyer.
Debenhams is thought to be interested in the Jane Norman brand and assets as the firm has a concession in its stores. Edinburgh Woollen Mill has also been mentioned as it has a track record of turning around underperforming retail brands.
Retailing is clearly a difficult business. Only three years ago, the store's success was being hailed as shown by this piece by Helen Pidd .
The Guardian was warning about the impact of quarterly rent reviews due soon, which can pitch firms into administration.
The Jane Norman news follows on from the closure of most Habitat stores reported here last week though three flagship London stores remain open.
Here this weekend's Observer considers the reasons for Habitat's demise.
"In the end, the answer to the question "Who stabbed Habitat in the back?" follows the plot, not of an episode of Columbo, but of Murder on the Orient Express. Everyone on the high street, it seems, helped to wield the knife."
Some former employees are very sad. LibbyElite writes:
"The Habitat of the 70s and 80s was a fantastic place to work and a great business to work for, I know because I worked for the company for 17 years during that time. Habitat was never about FASHION it was always about GOOD design at good prices, with CDG backing us up with brilliant store design and fantastic innovative product.
"There always was an element of "shabitaters" around even then,but we always put it down to jealousy and ignorance! The great name of Habitat during the Conran era will never be forgotten by the people who had the privilege to work for the company during those days."
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