Mothercare UK administration plan threatens 2,500 jobs

Baby goods retailer Mothercare has said it plans to call in administrators to the troubled firm’s UK business, putting 2,500 jobs at risk.

Mothercare said its 79 UK stores were “not capable of returning to a level of structural profitability and returns that are sustainable for the group”.

It said its stores would continue to trade as normal for the time being.

Analysts said Mothercare had been slow to adapt to competition from rivals and the switch to online retailing.

‘Necessary step’

Mothercare has already gone through a company voluntary arrangement (CVA), which allowed it to shut 55 shops.

The planned administration also affects Mothercare Business Services Limited (MBS), which provides certain services to Mothercare UK.

“These notices of intent to appoint administrators in respect of Mothercare UK and MBS are a necessary step in the restructuring and refinancing of the Group,” Mothercare said.

“Plans are well advanced and being finalised for execution imminently. A further announcement will be made in due course.”

Only 500 of the jobs at risk are full-time posts, including head office roles, with 2,000 part-time.

Mothercare has been looking for a buyer for the UK stores, but with no success so far.

The company also operates in more than 40 overseas territories, which are not subject to administration.

Mothercare said that in the financial year to March 2019, its international business generated profits of £28.3m, whereas the UK retail operations lost £36.3m.

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