La Senza and Past Times on brink of failure

High-street names overwhelmed by brutal trading conditions likely to appoint KPMG as administrator
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The Independent Online

The lingerie chain La Senza and the gift retailer Past Times were both on the brink of administration last night, leaving thousands fearing for their jobs over Christmas.

In separate processes, both chains have filed a notice of intention to appoint KPMG as administrator – if an 11th-hour rescue cannot be completed for them.

This does not mean they are in administration yet, but La Senza and Past Times are likely to hire the accountancy firm for formal insolvencies over the coming days.

La Senza, which has 146 stores and is owned by Lion Capital, hired a restructuring team at KPMG earlier this month in a desperate attempt to reshape its burdensome debts.

Meanwhile, Past Times, the retro-themed gift chain with more than 100 stores is also working with the accountancy firm. It made a loss in 2010 and has been struggling for years.

More retail casualties are expected to follow over the coming days, as retailers battle a brutal downturn and face paying their first-quarter rent on Christmas Day.

The shoe group Barratts Priceless collapsed this month, putting nearly 4,000 jobs at risk. The outdoor retail specialist Blacks Leisure is expected to be rescued through a pre-packaged administration early in January.

La Senza confirmed its woes. A spokeswoman said: "Due to trading conditions in La Senza's high street locations and the overall macro environment which are having an adverse effect on the company, the board of directors of La Senza has filed a notice of intention to appoint administrators."

She added: "The business continues to trade as normal in the meantime and there have been no unplanned redundancies or store closures."

La Senza may appoint KPMG within 10 business days.

Limited Brands – which owns the US lingerie chain Victoria's Secret and also operates La Senza in North America – is the favourite to acquire parts of the UK retailer out of administration.

Under the terms of its contract, the right to use the La Senza brand in the UK reverts back to Limited Brands in the event of an administration.

Limited Brands will open its first Victoria's Secret shop in London next year and the group is expected to cherry-pick the best La Senza shops from the administrator. But a large number of La Senza's stores will close, leading to job losses among its 2,600 staff.

Lion Capital acquired La Senza for £100m in July 2006 from Theo Paphitis, the owner of the stationer Ryman and star of the BBC's Dragons' Den series. He bought La Senza for £1 in 1998.

Past Times, the retailer of retro-themed gifts, is also on the verge of administration again. Epic Private Equity, which declined to comment, acquired Past Times out of administration for £7.75m in December 2005.

Past Times made a loss of £1.53m in the year to 25 December 2010, on turnover of £46.5m. The retailer has more than 100 stores but it typically opens a number of pop-up shops during the run-up to Christmas.

Epic also owns the tea specialist Whittard of Chelsea, which it acquired in a pre-pack administration in December 2008.

Elsewhere, Blacks Leisure confirmed it has failed to receive a takeover approach for its equity.

The update on its sales process sent shares in the group, which operates 98 Blacks and 208 Millets shops, tumbling by more than half to just 0.8p.

But Blacks said it had received bids for its trading businesses, assets and brands, which it is almost certain to sell through a pre-pack administration.