McColl’s has confirmed that the company has collapsed into administration with plans to “implement a sale of the business to a third-party purchaser as soon as possible”.
This morning the retailer’s senior lenders declined to further extend the waiver of the company’s banking covenants, which has now expired.
It added that while discussions with the company’s key wholesale supplier to find a solution for its funding issues and to create a stable platform going forward had made significant progress, the lenders made clear that they were not satisfied that such discussions would reach an outcome acceptable to them.
“In order to protect creditors, preserve the future of the business and to protect the interests of employees, the Board was regrettably therefore left with no choice other than to place the Company in administration,” the retailer said in a statement.
It has drafted in PriceWaterhouseCoopers LLP as administrators, in the expectation that they intend to implement a sale of the business to a third-party purchaser as soon as possible.
A Morrisons spokesperson has commented on the outcome, saying: “We put forward a proposal that would have avoided today’s announcement that McColl’s is being put into administration, kept the vast majority of jobs and stores safe, as well as fully protecting pensioners and lenders.
“For thousands of hardworking people and pensioners, this is a very disappointing, damaging and unnecessary outcome.”