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Monsoon Accessorize is on the brink of calling in administrators, in a move that would put 3,500 retail jobs at risk.
The fashion chain, which operates about 230 stores, is expected to file a notice of intention to appoint administrators – a legal process which gives the business 10 days’ protection from creditors – as early as Friday, according to Sky News.
Peter Simon, the retailer’s founder, is thought to be considering another rescue deal despite pumping £12m into the business last year in a package which involved the closure of about 40 stores. He also promised to halve the £5m rent on the fashion business’s London head office, which he owns, to help reduce costs.
The 70-year-old entrepreneur, whose wealth was estimated by this month’s Sunday Times Rich List to have slumped by £137m to £250m, is said to be keen to keep the brand he founded 50 years ago on the high street.
However, it’s understood that advisors to Monsoon Accessorize are also talking to restructuring specialists who may take on the business in the hope of saving at least some of its high street outlets.
Simon recently appointed advisory firm FRP to explore a sale of the business, while stores have been closed under the government high street lockdown to help prevent the spread of coronavirus.
The problems at Monsoon Accessorize emerged as Debenhams cut more than 1,000 jobs at its headquarters and in stores.
The department store is making redundancies in head office teams including merchandising, buying, design and other administrative functions at head office, as well as in cafes and other services in stores that will not reopen under social distancing rules.
The cuts come after Debenhams went into administration for the second time in a year in April since when it has confirmed plans to permanently close at least 17 of its 142 stores.
Fashion retailers and department stores have been hit by the high street lockdown but were already under pressure from rising costs and a slowdown in spending on fashion.
The shift to online shopping and new competition from the likes of Asos, Boohoo and a plethora of new brands has increased competition and forced traditional retailers to invest in expensive delivery infrastructure required for digital retail.
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