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| Woolworths enters administration | Woolworths enters administration |
| (10 minutes later) | |
| Administrators are to begin working at Woolworths after its board agreed to call them into the ailing UK retailer. | Administrators are to begin working at Woolworths after its board agreed to call them into the ailing UK retailer. |
| All 815 stores will stay open for now, but 30,000 jobs are at risk after the chain buckled under its £385m debt. | All 815 stores will stay open for now, but 30,000 jobs are at risk after the chain buckled under its £385m debt. |
| Deloitte was last night appointed as administrator to the High Street store and also to Entertainment UK, which supplies DVDs to supermarket groups. | Deloitte was last night appointed as administrator to the High Street store and also to Entertainment UK, which supplies DVDs to supermarket groups. |
| Furniture chain MFI is also going into administration after suffering several years of financial trouble. | Furniture chain MFI is also going into administration after suffering several years of financial trouble. |
| Woolworths' joint venture with BBC Worldwide - publisher 2 Entertain - will not go into administration as it is owned by Woolworths' parent company. | Woolworths' joint venture with BBC Worldwide - publisher 2 Entertain - will not go into administration as it is owned by Woolworths' parent company. |
| Money has also been ring-fenced so that salaries will be paid to Woolworths' 25,000 staff as normal on Friday, a spokeswoman added. | Money has also been ring-fenced so that salaries will be paid to Woolworths' 25,000 staff as normal on Friday, a spokeswoman added. |
| A further 5,000 are employed by Entertainment UK. | A further 5,000 are employed by Entertainment UK. |
| WOOLWORTHS FACTS First UK store opened in Liverpool in 1909Has 815 stores across the UKOwns 40% share of publisher 2 EntertainOwns distribution business Entertainment UK What is the point of Woolworths?Robert Peston's analysis | WOOLWORTHS FACTS First UK store opened in Liverpool in 1909Has 815 stores across the UKOwns 40% share of publisher 2 EntertainOwns distribution business Entertainment UK What is the point of Woolworths?Robert Peston's analysis |
| BBC business editor Robert Peston says that Woolworths has been something of a lame duck retailer for years, losing market share against intense competition. | BBC business editor Robert Peston says that Woolworths has been something of a lame duck retailer for years, losing market share against intense competition. |
| The company's weak position was also the reason why the government did not intervene to rescue it. | The company's weak position was also the reason why the government did not intervene to rescue it. |
| "Government policy is not to prop up lame ducks," our correspondent said. | "Government policy is not to prop up lame ducks," our correspondent said. |
| Employment Minister Tony McNulty said Jobcentre Plus was ready to help anyone who lost their jobs, but cautioned that people should "wait and see" over the scale of losses. | Employment Minister Tony McNulty said Jobcentre Plus was ready to help anyone who lost their jobs, but cautioned that people should "wait and see" over the scale of losses. |
| Lord Mandelson, the business secretary, was in contact with the company on Wednesday, to ensure that if it went into administration, it would minimise the anxiety to its employees. | Lord Mandelson, the business secretary, was in contact with the company on Wednesday, to ensure that if it went into administration, it would minimise the anxiety to its employees. |
| The company has been asked to do what it can to protect its pension fund, and keep its stores open if possible during the vital Christmas period. | The company has been asked to do what it can to protect its pension fund, and keep its stores open if possible during the vital Christmas period. |
| The UK's Woolworths has no connection with several retail chains around the world that carry the same name. | The UK's Woolworths has no connection with several retail chains around the world that carry the same name. |
| See how Woolworths' shares plunged during the past year | See how Woolworths' shares plunged during the past year |
| High Street trouble | High Street trouble |
| Meanwhile, MFI had asked its landlords for a rent-free period to help sort out its financial problems. | Meanwhile, MFI had asked its landlords for a rent-free period to help sort out its financial problems. |
| But the company, which has more than 1,000 staff, failed to reach an agreement. | But the company, which has more than 1,000 staff, failed to reach an agreement. |
| MFI had suffered several years of financial trouble. | MFI had suffered several years of financial trouble. |
| Last September, as part of a management buy-out led by chief executive Gary Favell, 81 loss-making outlets were placed into administration. | Last September, as part of a management buy-out led by chief executive Gary Favell, 81 loss-making outlets were placed into administration. |
| Now the remaining 110 stores could face closure. | Now the remaining 110 stores could face closure. |
| The shopworkers' union Usdaw said the news on Woolworths was "devastating" for staff. | The shopworkers' union Usdaw said the news on Woolworths was "devastating" for staff. |
| BBC business editor Robert Peston: "Woolworths was weak for years" | BBC business editor Robert Peston: "Woolworths was weak for years" |
| The company has struggled under the weight of £385m of debt. | The company has struggled under the weight of £385m of debt. |
| Its problems were compounded over the past couple of months when it was forced to pay cash when buying goods from suppliers, because trade credit insurers were no longer prepared to insure suppliers to Woolworths. | Its problems were compounded over the past couple of months when it was forced to pay cash when buying goods from suppliers, because trade credit insurers were no longer prepared to insure suppliers to Woolworths. |
| During the past few days the company had tried to sell itself for a nominal price of £1 witj the new owner taking on the firm's debt. | During the past few days the company had tried to sell itself for a nominal price of £1 witj the new owner taking on the firm's debt. |
| Earlier this week, Woolworths' largest shareholder - property tycoon Ardeshir Naghshineh - had called on Woolworths to delay plans to sell parts of the business. | Earlier this week, Woolworths' largest shareholder - property tycoon Ardeshir Naghshineh - had called on Woolworths to delay plans to sell parts of the business. |
| Mr Naghshineh said the firm should instead look at making money by selling off some of its outlets. | Mr Naghshineh said the firm should instead look at making money by selling off some of its outlets. |
| In the end Woolworths' board ran out of time. | In the end Woolworths' board ran out of time. |
| Return to top | Return to top |
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