Comet close to administration
Comet, the struggling electricals retailer, could enter administration as early as today according to reports.
The company, which was bought by private equity firm OpCapita for a token £2 earlier this year, is estimated to have made a loss of £35 million in the year to 30 April 2012.
Following a weakening in the retailer’s financial situation ahead of the crucial Christmas trading period, it has been reported that Deloitte has been lined up as administrator for the chain with the appointment potentially coming as early as today.
Comet is understood to have faced a cash flow crisis after suppliers demanded that it pay upfront for stock. This followed reports that OpCapita had received unsolicited approaches from rival firms interested in buying the chain.
Never Miss a Retail Update!Concerns over Comet’s future have also resulted in it trading without credit insurance, which protects suppliers against the failure of a retailer.
Comet operates 240 stores in the UK. OpCapita has reduced staff numbers from 8,500 to 7,000 since purchasing the chain in an attempt to cut costs and improve efficiency.
