UPDATED: Allders placed in administration (From Croydon Guardian)

Croydon's biggest store placed into administration after financial woes

11:32am Friday 15th June 2012 in News By Andrew Bloss

Hundreds of jobs could be lost at Croydon's oldest department store after Allders was placed into administration.

The owners of Allders department store in North End have been in crisis talks all week to prevent the historic store from folding.

But adminsitrators Duff and Phelps have been appointed thsi morning after a solution could not be found.

Harold Tillman, who bought the business in 2005 after it fell into administration, requested a rent-free period from its landlords The Whitgift Foundation, and asked Croydon Council for a business rates-free period.

A Croydon Council spokesman said: “We are disappointed that, despite best endeavours within the very short time that was available, it has been unable to prevent this because of the store’s inability to raise working capital.

“As well as discussions with key parties, the council offered to defer business rate payments.

“It’s very unfortunate that Allders did not seek help from the local authority until after it had secured a notice of intention to appoint an administrator.

“The council’s first priority will now be to work with the administrators to see if we can create a future for the store.”

The council said it will prepare for the unwanted possibility of the store closing by putting in place an advice and support team for individuals and local businesses that would be affected.

Councillor Mike Fisher, leader of the council, said: “This is a significant blow to the town and it’s particularly sad that this situation has arisen in the year that Allders has been celebrating 150 years of trading in the borough.

“Like the rest of the country, Croydon is grappling with very difficult economic conditions and reduced spending power, and this shows how even the most long-established institutions are potentially threatened.

“Whilst there is no getting away from the fact that this is a very sad day for Croydon, we remain optimistic for the future of retail in the town.

"Two of the country’s largest retail developers remain keenly interested in our main shopping centre, Whitgift, and only a few weeks ago we approved Hammerson’s plans for the remodelling and expansion of Centrale. We are determined to ensure that our regeneration plans remain on track.

“And with new residential and business space already under construction, I still believe we are well-positioned for when the economy as a whole begins to grow again”

The store was forced to sell off all its branches except its flagship store in Croydon after falling into administration seven years ago and is the source of speculation after retail giants Westfield and Hammerson both showed interest in developing the entire Whitgift Centre site last year.

Geoff Bouchier, Matthew Bond and Philip Duffy, all of leading global financial advisory and investment banking firm Duff & Phelps were appointed Joint Administrators.

The administrators said the store remains open for business and concession partners are continuing to support the business during the administration.

Outstanding orders will continue to be fulfilled, they pledged.

A spokesman said: "The joint administrators are currently exploring all potential options to maximise the realisation for the company's creditors including a sale of the business. Some 300 employees (excluding concessions) are affected.

Allders director, Andrew Mackenzie, said: “While our funders, shareholders and concession partners have been supportive throughout and the ongoing restructure was progressing, the tough market conditions in the UK retail sector have forced the board to appoint administrators in order to protect the business and its creditors.

"We will now work with the administrator to continue ongoing discussions with funders and other interested parties in the business. With the considerable support already given by Croydon Council and our landlord Minerva, I would hope that additional investment or a sale can be achieved.”