Update: Jobs under threat as Clinton Cards falls into administration
MORE than 8,000 employees at struggling retail chain Clinton Cards face an uncertain future following the appointment of administrators.
The greetings card company, which runs 628 Clinton stores and a further 139 under the Birthdays brand, appeared to have gained some breathing space last week when its banks – Barclays and Royal Bank of Scotland – sold its �35million of loans to American Greetings, its largest supplier.
American Greetings had been expected to extend a waiver previously granted by the banks following technical breaches by Clinton of the loan terms.
But Clinton said today it had been informed that American Greetings planned to enforce the loan and, as it was unable to repay the sum, it had “no option but to concur with American Greetings’ proposal to place the company and its subsidiaries into administration”.
Peter Saville, Simon Freakley and Anne O’Keefe, partners at corporate advisory and restructuring specialist Zolfo Cooper, were appointed joint administrators over Clinton Cards plc and its subsidiaries, including Birthdays Retail Ltd, later in the day.
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Clinton, which recorded a pre-tax loss of �3.7million in the 26 weeks to January 29, has suffered amid increased competition from online rivals such as Moonpig and WH Smith’s Funky Pigeon, which sell personalised cards, as well as from supermarkets.
Its stores includes Clinton outlets in Ipswich, Felixstowe, Bury St Edmunds, Sudbury and Lowestoft while there are also Birthdays stores in Ipswich and Stowmarket.
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Mr Saville said: “We will continue to trade the business whilst we undertake a full marketing exercise to find buyers for all or parts of the group so that the best possible outcome can be achieved for stakeholders.”
He added: “It is likely that a number of stores will need to be closed in order to make the business financially viable. However, Clinton Cards and Birthdays are very well-known brands on the high street and we believe that there is a strong underlying core business.”