Facia shoe shops saved from hands of receivers

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The Independent Online
The footwear interests of Facia, the collapsed retail group, were saved from receivership yesterday when a high court agreed to place the companies into administration. The arrangement includes the Freeman Hardy Willis, Saxone, Curtess and Manfield chains and will enable them to trade as ongoing concerns with some protection from creditors. The deal covers around 340 stores which employ around 1,400 staff.

Earlier, lawyers representing Facia's bankers and KPMG, the receivers to the rest of the stricken group, had argued for the shoe shops to be placed in receivership.

Instead, Alan Barrett and Dipankar Ghosh of Price Waterhouse have been appointed as administrators to the footwear businesses. As Grant Thornton is acting as receivers to the Salisbury's luggage chain, yesterday's ruling means that three separate groups of officials are presiding over Facia.

As Facia's founder Stephen Hinchliffe continued to meet potential backers with a view to regaining control of the company, the various officials reported strong interest in the individual businesses from other parties.

Grant Thorton said it had received around 30 expressions of interest in Salisbury's, which operates 174 outlets and has sales of pounds 50m last year.

KPMG said that it had received 62 expressions of interest in parts of the group from UK groups as well as others from the US, Belgium and Canada. KPMG is acting as receivers for the Facia parent company as well as Contessa, Oakland Menswear, Torq jewellers and Red or Dead.

KPMG held inconclusive meetings with Bank of Scotland, bankers to Sock Shop which is not in receivership. The meetings will continue tomorrow.

Mr Hinchliffe is now co-operating with KPMG after relations appeared to have broken down over the weekend. Mr Hinchliffe was yesterday meeting with various potential backers in a bid to raise the pounds 7m owed to the United Mizrahi Bank of Israel. However, KPMG said it had received no expression of interest from the former Facia chairman.

Gary O'Brien, Facia's chief operating officer has also yet to make a move though he is thought to be interested in putting together a rescue bid.

Sears, which is owed pounds 6m by Facia, said its chief executive Liam Strong still had the support of the board. Sears chairman Sir Bob Reid held meetings with analysts yesterday to explain the administration procedure and the effect on the company. The leases on the stores now revert to Sears and the company has been forced to provide for a further pounds 25m of exceptional costs to cover the disposal of unwanted properties and the other outstanding debts. Sears claims that it has kept the City informed of developments in the footwear businesses it sold to Facia.