Ciro Citterio takes Dunn & Co into the fold

The Dunn & Co chain of men's outfitters was rescued from receivership yesterday when fashion retailer Ciro Citterio bought the group for an undisclosed sum. The deal will save nearly 500 jobs as the purchaser pledged it would maintain the group's 130 stores, its warehouse and head office.

But though the Dunn & Co name will survive, it will be in a diminished form. "Some of the shop names will be changed to Ciro Citterio as that is the more successful format," a spokeswoman confirmed. "But we will retain the Dunn & Co name where it works."

Peter Fitzpatrick, Ciro Citterio's operations director, said: "Strong design and quality coupled with customer service have always been our hallmarks and we plan to inject these strengths into Dunn & Co." Ciro Citterio has around 200 stores in Britain.

The group is run by the Thakrar family, who are thought to have moved to Britain from Uganda in the 1970s. It acquired the Hornes menswear chain in 1993 and last year bought the Oakland menswear chain after its owner, the Facia group, collapsed into receivership.

Receivers KPMG declined to say how much the group paid for Dunn & Co. However, it is understood that unsecured creditors, who are owed pounds 4m, are unlikely to receive a dividend.

Dunn & Co, which was founded in 1886, slid into receivership a week before Christmas with debts of pounds 6.4m. Its trading record was poor and it had been losing pounds 1m a year on sales of pounds 25m.

However, trading has picked up and KPMG said sales during the first 15 days of Dunn's Christmas sale reached pounds 2.3m. This was ahead of the same period last year.

KPMG is still trying to sell Dunn & Co's corporate clothing operation but remains confident a buyer can be found.

KPMG's Paul Jeffrey said: "This is a satisfactory deal and we are pleased that the uncertainty surrounding Dunn & Co has been removed so quickly."

Dunn & Co was the result of a buyout in 1994 and prior to the receivership venture capitalists CinVen owned 86 per cent of the group.

The receivers' task in finding a buyer for chain, which has a reputation for tweedy suits and formal flannels, has probably been eased by buoyant conditions on the high street.