Potential buyers line up for British Bookshops
Potential buyers for the failed British Bookshops & Stationers chain have stepped forward as administrator, Zolfo Cooper confirmed the business would continue to trade for at least a number of weeks.
The firm, based in Hollingbury, has 51 bookshops and about 300 staff across Sussex, Surrey, Essex and Hampshire. It was put into administration following cash flow problems and tough trading conditions, particularly due to the bad weather before Christmas. The business recorded a turnover of £25.7m in the year to end-January 2010, but made a loss of £6m.
Greetings businesses caught up in the failure include Cavania Cards, which took its first order from BBS last year. Cavania MD, Christian Watters told GT: "They [BBS] approached us for an order of albums worth about £2,500 back in October and never paid."
Restructuring specialist GA Europe is assisting Zolfo in running BBS as the preferred creditor following its purchase of a debenture from private equity firm Endless, which had sold BBS to a management buy-out led by former managing director John Simpson.
The debenture related to a deferred payment that was owed to Endless by the MBO team that ensured Endless was the primary creditor of the business in the case of its failure.
Gavin George, managing director of GA Europe indicated there were some retail levers he could pull once he had evaluated the stores’ profitability. “We’ve changed absolutely nothing since we’ve been involved. We’ve not changed the range, the pricing, or the marketing strategy,” he said.
A spokesperson for Zolfo Europe, said BBS was an "attractive company" and "all possible options" for the future of the company would be considered.
The company started life as Sussex Stationers and grew during the 1980s and 1990s into a regional chain.
It was sold to Irish booksellers Eason and Sons and was again sold in May 2009 to private equity firm Endless, which installed a new management team.