Written by: Keith Tully
Date: Monday 17th December, 2012
Comet - formerly one of the UK's most recognised high street retailers - will officially close its doors today meaning thousands more jobs will go just a week before Christmas.
Administrators Deloitte said the electrical goods chain will close its 50 existing stores after they were unable to find a buyer for the company. Over half of the group's original 6,600 workforce have already gone since Deloitte began its processes in early November, and now over 3,000 more jobs will be cut as the Comet lights finally go out.
Deloitte's report on the decline of the 236-branch chain is understood to show the group collapsed under the weight of almost £200m in losses, leaving no chance of most creditors and landlords getting their money back.
It is believed HM Customs & Revenue are on the unsecured creditors list to the sum of £26.1m in VAT and PAYE payments. On top of that, sources close to the administrators said the government has agreed to pay staff £24m of redundancy pay - meaning a total hit of £50m for the government.
The report is also expected to detail attempts to rescue and restructure the flailing Comet business in the past six months, noting that although costs were coming down, sales were declining at a faster pace with many consumers rebuffing the stock clearances in favour of more competitively priced electrical goods online.
Deloitte has divided up over £80m of assets held by Comet between preferential creditors with Hailey Acquisitions Limited (HAL) receiving almost £50m of the £145m they are owed.
Staff will also get £2.1m of holiday and back pay they are owed in full. Trade suppliers, meanwhile, will receive some of what they are owed, under a scheme that means they still own the goods they have supplied if they are not paid for them. About 85% of suppliers have claimed so-called "retention of title", resulting in payments of about £40m from the administrators.
23rd October 2017 The British Chambers of Commerce (BCC) has called on the government to freeze business rates in order to provide a boost to the competitiveness and productivity of UK companies.
12th October 2017 The impact of Brexit and the process of Britain departing from the European Union is likely to push up rates of insolvency among businesses throughout the UK.
11th October 2017 Financial losses and persistent problems with cash flows has led the civil engineering business Owen Pugh to enter administration.
2nd October 2017 Monarch Airlines has become insolvent and ceased trading as a result of “mounting cost pressures and increasingly competitive market conditions,” administrators have confirmed.
29th September 2017 The Bank of England governor Mark Carney has given a clear indication that he expects the base rate of interest in the UK to rise in the near future.
Every day we help companies just like yours turn things around against seemingly impossible odds, regardless of your situation we can help. Find your nearest office today.