The company that holds the store leases of camera retailer Jessops has filed for administration in a bid to restructure its obligations and cut its outgoings, according to people briefed on the matter.
JR Prop manages the leases for Jessops under a structure similar to that used by the sub-brands of fashion retailer Arcadia. It has filed a notice of intent to appoint ReSolve as administrators, a move that affords the company creditor protection for a period of 10 days.
The group’s main trading company, Jessops Europe, is unaffected by the move.
One person with knowledge of the company’s plans said that its majority shareholder Peter Jones, a well-known entrepreneur and judge on the BBC television show Dragons’ Den, believed the company had a future but urgently needed to reduce its costs.
The intention is to do so via a company voluntary arrangement, although this would require the approval of three-quarters of the unsecured creditors and be subject to a 28-day challenge period.
Neil Old, the chief executive of the property subsidiary, resigned over the summer while auditor Grant Thornton quit last year.
The specialist retailer has had two previous brushes with insolvency as the growing sophistication of mobile phone cameras reduced demand for the traditional variety. In 2010, it was acquired by its main creditor, HSBC, in a debt-for-equity deal that also resulted in an employee benefit trust and its pension fund becoming shareholders.
However, by 2013 it had collapsed again, leading to the closure of 192 stores. Mr Jones acquired the group out of administration, initially with a view to trading online only. But he subsequently reopened 46 stores, asserting that within three to five years the company could generate up to £200m of revenue.
The most recent accounts for Jessops Europe showed revenue of £84.7m for the year to April 2018. Earnings before interest tax depreciation and amortisation were £1.64m, up 31 per cent from the previous year.
Revo, the retail property owners group, said a CVA would be “yet another example of a retailer blaming all of its struggles on store rents and expecting property owners to take all of the financial pain.
“It is still too easy for retailers that have been poorly managed or have failed to modernise to seek a quick fix in rent cuts and store closures,” it added.
A spokesperson for Jessops declined to comment.
