Claire's and The Original Factory Shop near collapse, putting 2,550 jobs at risk

"Modella said in a statement that the climate on UK high streets was extremely challenging and data suggested an alarming drop-off in pre-Christmas footfall. It said administration was the only option for both Claire's and The Original Factory Shop, and it had started insolvency proceedings for both chains. The investment group has 154 Claire's stores after buying about half the UK chain from administrators in September last year."

"Modella said on Monday: This has been a very tough decision. We have worked intensively in an effort to save both businesses, having made last-ditch attempts to rescue them, but neither has a realistic possibility of trading profitably again. A combination of very weak consumer confidence, highly adverse government fiscal policies and continued cost inflation is causing many established and much-loved businesses to suffer badly."

"The 140-store cut-price homewares chain The Original Factory Shop, which was bought by Modella less than a year ago from the private equity group Duke Street Capital, has filed a notice with the high court to appoint administrators. About 1,200 jobs are at risk. The move, under which the advisory firm Interpath would be appointed, gives the company 10 days' protection from creditors while negotiations on its future continue."

Claire's and The Original Factory Shop face administration with about 2,550 jobs at risk after owner Modella Capital began insolvency proceedings. Modella owns 154 Claire's stores after buying roughly half the UK chain last September and acquired The Original Factory Shop less than a year ago. Advisory firms Kroll (Claire's) and Interpath (Original Factory Shop) are lined up to handle administrations. The Original Factory Shop has filed a high court notice and secured 10 days' protection from creditors while options are explored. Modella cited weak consumer confidence, adverse government fiscal policies, cost inflation and a sharp pre-Christmas footfall drop as drivers.

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