| CATEGORY: NEWS AND ANNOUNCEMENTS |
MFI calls in administrators |
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Wed 26 Nov 2008
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LONDON (SHARECAST) - Britain’s largest furniture retailer MFI has gone into administration due to weaker demand and problems with cash flow and credit lines.
More than 1,000 jobs are at risk after the company said administrators, MCR, will attempt to offload the business as a going concern.
The immediate closure of 26 stores has already cost 260 jobs. ‘Closing down’ sales will be launched at all 110 stores.
“The administration follows the continuing pressure on the home market, which has accelerated in recent weeks with sales levels falling further behind prior year levels,” said the firm, founded as Mullard Furniture Industries in 1964.
“The company has suffered from severe cash flow pressure as a result of credit insurance being withdrawn across the sector and the general market deterioration, which has led to the failure of certain key suppliers.”
All customers will either receive their goods or get a refund.
“Whilst a decision has not been made as to an appropriate exit route and the future of the company, the administrators will be reviewing the possibility of a sale of some or all of the company’s stores,” said Phil Duffy, of joint administrator MCR.
Outstanding employee wages have been paid up to date, and all remaining staff will continue to be paid.
MFI’s retail business was sold to private equity firm Merchant Equity Partners for £1 before a management buyout in September. Galiform owned the manufacturing arm.
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