Sleep Depot enters administration

Land of Leather said Sleep Depot, which operates concessions out of the company’s stores, has gone into administration after failing to agree a financial restructuring.

The bed firm based in Blackburn is now in the hands of Manchester-based administrators Kroll. The firm which had more than 100 outlets, said it has been struggling amid ‘very challenging‘ market conditions.

Land of Leather said the loss of annual rent from Sleep Depot will cost the company £1.6 million throughout the remainder of 2008. However, some of this can be reclaimed by trading from the vacated space.

Last week, Land of Leather announced pre-tax profit for the half-year to the end of January was down to £5.55 million from £5.80 million last year.

Following the news, shares in Land of Leather fell 14.8%.

The news follows that from Robert Tchenguiz, the property entrepreneur, who put his Laurel Pub Company into administration after failing to find buyers. Laurel’s 460 sites include a mixture of Yates’s, Hog Head, Litten Tree and Bar Med, Slug and Lettuce and La Tasca.

Furthermore, The Centre for Economics and Business Research warned last week that a flood of retailers are expected to be forced into administration after a dismal Easter weekend’s trading.

Last month clothing chain Select Retail, had to be rescued from administration while Mexx, the US-owned fashion retailer, announced it was to close its UK stores. Furthermore, department store John Lewis reported its biggest sales decline for a year.

Last week, French fashion chain Morgan yesterday informed employees that all its 40 British stores are likely to be closed by the end of this month because of losses. A spokesperson said they had been hit by competition from cheaper rivals such as Topshop as well as the slowdown in consumer spending.

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