Mothercare lines up administrators for UK business


Mothercare AdministrationMothercare is finalising a radical restructuring plan that could see its British operations placed into administration this week, dealing a fresh blow to a beleaguered retail sector. 

Sky News has states that the company, which is now dominated by its franchising business outside the UK, has put administrators on standby to take over its domestic division within days.

If confirmed, the move would put thousands more high street jobs at risk. It would not, however, directly affect its publicly quoted parent company, which is in advanced talks with lenders about a fresh refinancing that would secure its future, according to insiders.

Mothercare’s UK business represents only a small part of its overall group sales.

Mothercare UK Limited & Mothercare Business Services Limited – both in administration (“the Companies”)

Mothercare is the latest casualty of the high street retail crisis, with the struggling retailer announcing that it has hired administrators to oversee its UK business. The move comes after several months of unsuccessful attempts to find a buyer for the company, which has been struggling under the weight of mounting debts. Mothercare’s UK operations employ around 2,500 people, and it is not yet clear what will happen to these employees if the business is forced to close its doors.

The company’s UK troubles are just the latest development in a long-running saga that has seen Mothercare steadily lose market share in recent years. In 2018, the retailer announced plans to close 50 stores across the country as part of a wider restructuring effort. However, these measures failed to stem the tide of decline, and Mothercare has now been forced to take more drastic action in a bid to stay afloat. Administrator Moorfields Advisory has said that it will continue to operate Mothercare’s UK business while it searches for a buyer, but it remains to be seen whether a rescue deal can be found. In the meantime, Mothercare’s future looks increasingly uncertain.

Read more: What is the company administration process

PwC were appointed as joint administrators of Mothercare UK Limited

Sources said that any insolvency process would trigger a renewed effort to find a buyer and possibly a further restructuring, potentially including another wave of shop closures. The company is thought to have lined up an accountancy firm to handle the administration of Mothercare UK Limited, this is believed to be KPMG the restructuring experts.

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Insolvency & Restructuring Expert at Business Insolvency Helpline

With over three decades of experience in the business and turnaround sector, Steve Jones is one of the founders of Business Insolvency Helpline. With specialist knowledge of Insolvency, Liquidations, Administration, Pre-packs, CVA, MVL, Restructuring Advice and Company investment.