UK retailer Adams on the brink of bankruptcy

LONDON – December 29, 2008 Spokeswoman Ginette Gisborne said the central England-based kids clothing retailer had applied to go into administration - a form of bankruptcy protection - on Wednesday and was expected to be placed in the hands of administrators at PricewaterhouseCoopers on Monday.

The administrators will then try to salvage as much of the company as possible for the benefit of creditors. That can involve trying to keep the business as a going concern or breaking it up and selling it off.

"We don't know whether the stores will close or some stores might be sold," said Gisborne. "The director of the company is in a meeting right now discussing details."

Adams - which employs around 2,000 people, has 260 stores in Britain and over 100 international outlets in the Middle East and Europe - is owned by Northern Ireland businessman John Shannon, who bought it out of administration less than two years ago.

It supplies clothes for the retail chain Boots and sells clothes through its own outlets.

PricewaterhouseCoopers declined to comment on Adams because it has not yet been appointed as administrator.

Adams is set to be the latest in a series of big British retail brands to be hit by the economic turmoil - 99-year-old general store Woolworths, tea and coffee merchant Whittard of Chelsea and music chain Zavvi, have already been forced to file for administration.

About 200 Woolworths stores closed Saturday and the remainder are expected to close over the next week unless a buyer is found. Whittard has been sold.

The news that Adams is on the brink of collapse comes after insolvency specialist Begbies Traynor predicted last week that as many as 15 "major" British household-name retailers could fail by the middle of January.

In total, 356 British retail companies collapsed during the third quarter of 2008 - 39 percent more than the same period last year - according to The Insolvency Service.

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