Woolworths, a bastion of the British high street that sold everything from sweets to toasters, will close by January 5 with the loss of 27,000 jobs unless a last-minute buyer can be found.
It would be the first big name business in the UK to fail since the economy soured. Several banks have suffered but those have been rescued by the government or bought out by rivals.
Deloitte, administrator to the 99-year-old retailer, said it plans to close all of Woolworth's 807 stores by the first Monday in January if no sale of the business is agreed by then.
Neville Kahn, joint administrator, said 200 stores would close on December 27 followed by tranches of about 200 stores on December 30, January 2 and January 5, meaning 22,000 permanent and 5,000 temporary staff would be made redundant.
The announcement coincided with news that the number of Britons out of work and seeking benefits surged last month by the biggest margin since 1991.
Kahn told reporters on a conference call that Deloitte was “in discussions with some parties that have come in as recently as this weekend” in respect of Woolworths' retail business, including investors from the UK and overseas.
He also said Deloitte was in talks with interested parties about selling the Woolworths brand and trademark as well as the rights to toy brand Chad Valley and clothing line Ladybird.
Woolworths Group Plc's retail business, which sold an eclectic mix of homewares, snacks, clothes and DVDs, collapsed into administration, along with its Entertainment UK (EUK) wholesale distribution business, on November 27.
Kahn said Woolworths had been trading strongly over the last few days and that it would reload its stores with stock and increase discount activity over the next week.
Deloitte commenced a closing down sale at the stores on Thursday and on Friday made 700 EUK employees redundant.
Kahn said 300 of the stores were “under offer” and that there was “considerable interest” in the remaining 500, with bids in from food, clothing and value retailers.
“There has been substantial interest in the stores over the last few days,” said Kahn, who added that Deloitte was chasing up all debt owed to the group.
Woolworths sells more sweets than any other British retailer and has top five positions in toys, children's clothing, homewares and entertainment products.
Bertrams Books, a unit of EUK, and 2Entertain, a DVD publishing joint venture between EUK and the British Broadcasting Corporation's BBC Worldwide, continue to trade as usual, said Deloitte. Kahn, however, struck a note of optimism amid the gloom by predicting that Woolworths would “come back onto our high streets sometime.”
In all Woolworths Group Plc employs about 30,000. (Reuters)