Carpetright lines up administrators as sale talks continue
Carpetright has filed a notice of intention to appoint administrators, a move that could lead to significant job losses and store closures.
This decision comes amidst ongoing discussions to secure additional investment and ensure the long-term future of the company.
The retailer, which operates 272 stores and employs 1,852 people in the UK, cited financial pressures following a cyber-attack in April that disrupted trade and impacted its restructuring plans. In response, Carpetright is seeking a “period of protection” while it works to finalise new investment. PwC has been lined up as potential administrators, although they have not yet been officially appointed.
The notice provides Carpetright with ten days of protection as it continues to search for a buyer. The company has reassured customers that it will continue to trade as normal during this period, with all stores remaining open and orders being fulfilled.
Kevin Barrett, CEO of Carpetright’s parent company, Nestware Holdings, emphasised the company’s commitment to minimising the impact on customers and employees. “We remain focused on securing external investment to ensure as few customers and colleagues are impacted as possible. They are our main priority and we are taking all appropriate action to make sure they are informed and supported through this process. We have begun promising conversations with interested parties that are moving in the right direction, encouraging us that Carpetright has a viable future,” Barrett stated.
According to The Times, the retailer has drafted in advisers at PwC to launch a formal sale process, which sources suggest may be completed via a pre-pack deal or company voluntary arrangement. Potential buyers include The Floor Room, owned by Carpetright’s parent company Nestware Holdings, and Tapi Carpets, founded by the son of Carpetright’s founder, Lord Harris.
Despite these challenges, Carpetright is determined to navigate through this period of financial uncertainty. The company, founded by Lord Harris of Peckham in 1988, has previously faced difficult times, including a significant restructuring in 2018 that resulted in the closure of dozens of stores.
The cyber-attack in April was described as the “straw that broke the camel’s back” by John Cullen, partner and insolvency expert at business advisory firm Menzies. He highlighted the tough trading conditions in the retail sector, particularly for businesses selling big-ticket items.
Carpetright’s history of resilience and its ongoing efforts to secure new investment offer some hope for the future. The company, which delisted from the London Stock Exchange in 2020, continues to offer a wide range of products, including flooring, mattresses, curtains, blinds, garden furniture, and artificial grass.
As the retailer navigates this challenging period, the focus remains on securing its future and protecting as many jobs as possible. Further updates are expected as sale negotiations progress.
