Historic carpet maker Axminster heads towards administration
Move threatens 400 jobs at Devonshire factory as it seeks to find a rescue package
Axminster Carpets has signalled its fortunes were unravelling rapidly after it filed an administration notice, leaving 400 jobs hanging by the proverbial thread.
The carpet maker, based in the eponymous Devon town, now has a moratorium of 10 working days' protection from its creditors to stitch together a rescue package after it filed a notice of intention to appoint the advisory firm Duff & Phelps as administrator.
Established in 1755, Axminster Carpets has a Royal Warrant and its carpets are famous for their thickness, reflecting the unique weaving process and natural fibres.
It supplies major retailers, such as John Lewis and Carpetright, as well as royal residences, hotels and operators of airlines, trains and cruise liners, but the manufacturer has recently suffered a cash-flow crisis.
While Axminster Carpets has just two factory outlet shops, it's likely collapse follows a tumultuous start to the year for the retail sector.
The camera specialist Jessops, the entertainment chain HMV, the DVD rental firm Blockbuster and the fashion retailer Republic have all collapsed into administration in 2013, putting more than 10,000 jobs at risk.
Joshua Dutfield, the managing director at Axminster Carpets, said: "Trading has been difficult and the management has been working with key suppliers, creditors and the lenders in an attempt to resolve the company's financial difficulties.
"We continue to be committed to working to achieve the best-possible outcome for all concerned and most importantly the staff and suppliers."
Founded by Thomas Witty, the manufacturer's original carpet was specially woven for the library at Derbyshire's Chatsworth House when the room was altered by the 6th Duke of Devonshire in 1830. Axminster carpets were also supplied to Brighton Pavilion, while George III and Queen Charlotte also bought them and visited the factory.
In 1835, a disastrous fire halted production in Axminster which destroyed many of the original pattern books as well as the early looms.
The carpet business was then moved to the town of Wilton, Wiltshire, but 100 years later a chance meeting on a train between carpet maker Harry Dutfield and a West Country vicar led to production returning to its spiritual home in 1937.
To celebrate 250 years, the company made a commemorative rug which was paraded through Axminster and presented to the Earl of Devon. Prince Charles now walks on the same rug in Clarence House.
Before its financial crisis struck, Axminster Carpets nearly doubled its profits to £415,000 over the year to December 2010, on flat revenues of £32.7m, according to its latest accounts. Perhaps worryingly, its shareholders paid themselves a dividend of £500,000 that year.
In further gloom, the administrator to HMV confirmed that a further 37 of the failed chain's stores, which employ 464 staff, had been identified for closure.
Deloitte said it expected these latest closures to take place alongside the 66 already earmarked to shut over the next four to six weeks.
The restructuring specialist Hilco acquired the debt of HMV, which currently operates 219 stores, last month for less than £40m.
Hilco, which declined to comment, remains interested in acquiring a slimmed-down version of the CD and DVD retailer with about 130 stores.
Historic rolls: Founded in 1755
A weaver, Thomas Whitty, founded Axminster in 1755 after seeing a Turkish carpet in London. Over the next 80 years, the Devonshire business provided carpets for grand homes, the Royal Pavillion in Brighton and even the Sultan of Turkey. But the original business went bust in the 19th century after a fire destroyed the looms. Axminster is one of the few "fleece to floor" carpet makers that buy, spin and dye yarn before making carpets.
- 1 Kim Jong-un shows off airport designed by architect he likely had executed
- 2 Tunisia hotel attack: Locals form 'human shield' to protect hotel from gunman Seifeddine Rezgui
- 3 Why it matters 26 million people have changed their Facebook profile picture to a rainbow flag
- 4 German ethics council calls for incest between siblings to be legalised by Government
- 5 Fifty Shades of Grey author E.L James's Twitter Q&A didn't go exactly as planned
Michael Douglas regrets 'embarrassing' Catherine Zeta-Jones with oral sex comments
Kim Jong-un shows off airport designed by architect he likely had executed
Tunisia hotel attack: Locals form 'human shield' to protect hotel from gunman Seifeddine Rezgui
Ex-Scientologist Carmen Llwyelyn blasts 'cult' and her treatment after divorce with Jason Lee
Tunisian builder has been hailed a hero after knocking gunman to the ground with roof tiles
The moment a Queen's Guard soldier lost it and drew his gun at annoying tourist
Greece crisis: The wider lesson is that it’s time to abandon this failed experiment in currencies
'I wish the BBC would stop calling it Islamic State' – David Cameron unleashes frustration at broadcaster
Extend Right To Buy to tenants of private landlords, Labour's Jeremy Corbyn says
David Cameron struck double blow in his hopes to win Britain a new EU deal
Pentagon accuses Russia of 'playing with fire' over nuclear threats towards Nato
iJobs Money & Business
£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...
£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...
Negotiable: Recruitment Genius: This extremely successful and well-established...
Competitive with monthly bonus: Guru Careers: We are seeking an experienced FX...