Woolworths and MFI both enter administration

Well-known retailer Woolworths and furniture giant, MFI have collapsed into administration today.

This morning, Woolworths had its shares suspended after the group has been in crisis talks over the last few days.

The company, which is one of the UK’s oldest chains having been established for 99 years, has more than 800 high street shops and a workforce of 30,000.

Deloitte is to be appointed as administrators to the store chain and also to Entertainment UK, its UK distribution business.

However, the Woolworths joint venture with BBC Worldwide, publisher 2 Entertain, will not go into administration.

For some time now, the retailer has been struggling as it faces competition from large supermarkets and the internet.

In September, Woolworths announced a record first-half pre-tax loss of £90.8 million and scrapped its dividend to shareholders.

The news of Woolworths comes as furniture giant, MFI, has also been placed into administration.

Back in September, MFI was rescued from the brink of administration after a management buy-out.

The furniture chain has been struggling due to competition from companies such as B&Q, Homebase and Ikea.

Furthermore, analysts believe that the housing market downturn was a major factor to MFI’s demise since people ceased purchasing new kitchens and bathrooms.

MCR have been appointed as administrators.

Twenty six stores are to close but some will continue to trade. MFI has 110 stores and approximately 1,200 employees. The group was established in the 1960s and was renowned for its flatpack furniture.

Story link: Woolworths and MFI both enter administration