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| Bed retailer Dreams enters administration with loss of 400 jobs | |
| (about 1 hour later) | |
| Dreams, Britain's biggest beds retailer, has entered administration with the loss of 400 jobs. | |
| More than 90 of its stores will be closed, but the remaining 171 shops, and 1,675 jobs are being saved following a £35m pre-pack administration with the owners of rival bed and sofa firm ScS. | |
| The collapse of Dreams brings the total number of job losses in the retail sector to around 6,000 since the start of the year at failed firms including HMV, Jessops, Republic and Blockbuster. | The collapse of Dreams brings the total number of job losses in the retail sector to around 6,000 since the start of the year at failed firms including HMV, Jessops, Republic and Blockbuster. |
| Administrators from Ernst & Young have been appointed to oversee the sale of Dreams to the retail turnaround specialists, Sun European Partners, which trumped a rival bid by the Dreams founder, Mike Clare. | |
| Dreams has been the subject of administration rumours for many months following a long-running standoff between former private equity owners Exponent and Royal Bank of Scotland – the bed retailer's biggest lender. A bidding process started with offers submitted by last Friday. | |
| Jordan Wadsworth, vice president at Sun European Partners, said; "Dreams is a well-recognised brand known for its wide product range of beds, headboards, mattresses and associated products. | Jordan Wadsworth, vice president at Sun European Partners, said; "Dreams is a well-recognised brand known for its wide product range of beds, headboards, mattresses and associated products. |
| "Despite operating with an over-expanded store base and significant debt in the precarious economic climate of recent years, the business remains the market leader and, with our support, is now well positioned to capitalise on future opportunities." | "Despite operating with an over-expanded store base and significant debt in the precarious economic climate of recent years, the business remains the market leader and, with our support, is now well positioned to capitalise on future opportunities." |
| Clare, the former chairman and chief executive of Dreams, sold the business for £200m to Exponent in 2008, having set up the company with his wife in Uxbridge in 1986. | Clare, the former chairman and chief executive of Dreams, sold the business for £200m to Exponent in 2008, having set up the company with his wife in Uxbridge in 1986. |
| Despite the recent uncertainty, Dreams has been trading well with sales up 7.2% year-on-year in the four weeks to 7 January, while total sales rose 8%, a record December and new year performance. | Despite the recent uncertainty, Dreams has been trading well with sales up 7.2% year-on-year in the four weeks to 7 January, while total sales rose 8%, a record December and new year performance. |
| Last week accountancy firm PwC and the Local Data Company revealed high street store closures increased tenfold last year, with the number of stores closed by retail chains expected to double from 14 a day to 28. | Last week accountancy firm PwC and the Local Data Company revealed high street store closures increased tenfold last year, with the number of stores closed by retail chains expected to double from 14 a day to 28. |
| The report found that payday loan stores and pound shops are the fastest-growing retailers on the high street, with card shops, computer game and health food stores the most depleted. Payday loan firms increased their high street presence by 20%, pawnbrokers were up 13%, and nearly two pound shops were opened every week across the country. | The report found that payday loan stores and pound shops are the fastest-growing retailers on the high street, with card shops, computer game and health food stores the most depleted. Payday loan firms increased their high street presence by 20%, pawnbrokers were up 13%, and nearly two pound shops were opened every week across the country. |