Facia crash could cost 6,000 jobs

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The Independent Online
Around 6,000 jobs are under threat this weekend in some of the most familiar names on Britain's High Streets, following the pounds 30m collapse yesterday of the huge retail empire built up by the Sheffield businessman, Stephen Hinchliffe.

Sock Shop, Freeman Hardy & Willis and Saxone are among those that face the axe after bankers called in the receivers to the Facia group yesterday.

Accountants KPMG, who are handling the crash, were desperately trying to locate Mr Hinchliffe yesterday. He was believed to be in Sheffield, where he keeps one of several homes and owns 15 per cent of Sheffield United Football Club.

The 46-year-old entrepreneur built Facia from scratch in a breathtaking flurry of deals in just two years. With nearly 1,000 shops in all, it had almost half as many again as Marks & Spencer, making pounds 250m of sales a year.

Nobody was ever sure where the money came from, however, and Facia was already facing fines for failing to file accounts.

All the shops will open tomorrow and the receivers have already had approaches from buyers. But mounting losses - pounds 9m in the past 16 weeks alone, despite assurances that all was well - suggest a bleak future.

"It is likely to be a very complex case to resolve," said Tony Thompson, KPMG partner. "You have to conclude that the late filing of accounts means it may be difficult to gain full financial information."

It is not the first time Hinchliffe, a former accountant-cum-property developer, has gone bust. He is already facing disqualification as a director by the Department of Trade and Industry over the collapse of a property company in 1993.

As chairman of the Sheffield engineering company, James Wilkes, he was noted for his lavish lifestyle, before he was booted out with a handsome pay-off. Wilkes' corporate HQ at Beau-chief Hall on the outskirts of the city included a deer park, helicopter, luxury swimming pool and underground discotheque.

The retail giant Sears sparked the chain of events that led to yesterday's collapse, by applying for the High Court to take control of 380 of Facia's shoe shops. Sears, which owns Miss Selfridge, sold most of the shops to Mr Hinchliffe earlier this year and on Friday a pounds 4m rent cheque failed to arrive.

The move put United Mizrahi Bank, Israel's fourth largest and Hinchliffe's main backer, in an impossible position and it moved in the receivers to recover some pounds 7m of debt. Facia and five subsidiaries are affected: the Salisbury's luggage chain; Contessa lingerie; Oakland menswear, Torq jewellery and Red or Dead fashions.

Sock Shop is unaffected for the moment, but is likely to follow this week as creditors seek to protect themselves. Mr Thompson said Facia had no cash at collapse and pounds 30m debts.

Business, page 3