Coast fashion retailer collapses putting 300 jobs at risk
Women's fashion retailer Coast has gone into administration, putting 300 jobs at risk, in a sign of continuing pain on the High Street.
The collapse means the immediate closure of its 24 stores at locations including Oxford Street in London.
Karen Millen has bought some parts of Coast, whose website and department store concessions will keep trading.
About 600 staff will transfer to Karen Millen, but the remaining 300 workers now face an uncertain future.
Coast was owned by Aurora Fashions, which also owns retailers Oasis and Warehouse. Aurora is controlled by Icelandic bank Kaupthing, which also owns Karen Millen.
The retailer had numerous concessions in House of Fraser and was owed millions after the department store chain itself collapsed earlier this year.
Mike Denny, joint administrator and PwC director, said Coast had been facing financial difficulties due to its concessions business, as well as structural challenges in the retail sector and lower demand for occasion wear.
See reaction below:
"This sale puts the ongoing business on a firmer financial footing. Karen Millen will be working with the existing management team to continue to grow and develop the new business," he said.
"Regrettably, other parts of the business including 24 retail stores were not included in the transaction. We will make every effort to help those employees in parts of the business that were not included in the sale and will support those affected at this difficult time by liaising with the Redundancy Payments Service and Job Centre Plus."
Karen Millen said it was confident of being able to boost sales of Coast's "premium womenswear" ranges.
Beth Butterwick, its chief executive, said: "With its beautiful fabrics, stunning colours and signature designs, Coast is a much-loved fashion brand that has dressed women for all occasions since 1996.
"Our expertise and infrastructure puts us in a unique position to create a lean and profitable business, ensuring it remains a thriving destination in department stores and online."
Coast's concessions in department stores including Debenhams and John Lewis will continue to trade and gift vouchers will be honoured online. Uncollected click and collect orders will be refunded in due course.
The collapse of another retailer follows the demise this year of chains including Maplin, ToysRUs as well as House of Fraser.
New Look, Homebase and casual dining chains have also had to close dozens of outlets in a bid to remain profitable.
This week, the owner of the Patisserie Valerie cafe chain said it needed an "an immediate injection of capital" to continue trading in its current form.
The company said it had uncovered "significant, and potentially fraudulent, accounting irregularities".
By BBC
My view: It's sad that Coast has gone into administration and reportedly 300 staff will not receive redundancy and pay in lieu of notice, because the compay can't afford to pay them, it's baffling. I feel bad for the employees that have been with the company for over 12 years and this is how they are being discarded like dirt.