All 1,500 employees at Internacionale may lose their jobs if the fashion retailer fails to find a buyer soon. Reports suggest the company has even gone beyond administration, revealing ‘plan A’ as liquidation. However, it is expected administrators will be appointed this week to conduct a thorough review of the business.
The Scottish business currently trades at 97 stores across the UK, with all on the verge of being closed within a few weeks. The company has been struggling for a number of years, falling into significant debt and reportedly losing £10 million year on year.
Internacionale was bought out of administration in a pre-pack deal only last July by former chief executive Raj Sehgal, managing director, Naresh Abrol and finance director, William Milton. They have been attempting to turn the company around since 2011 but have been unable to progress in the current economic conditions.
FC Fund Managers took over restructuring the business last week, buying £35 million of debt. 20 members of staff based in the Glasgow head office were made redundant, leaving the remainder to oversee the business until the next actions are taken. PwC are expected to be appointed administrators later this week.
The retail sector has been hit hard over the last few years, with many high street retailers entering administration due to falling sales and poor trading conditions. While internet retailers are soaring, more traditional high street shops are struggling to keep up.
Update: 28th February 2014 -
Today, reports reveal the fashion retailer has gone into administration for the third time since 2008. Stores will stay open to sell the remaining stock, however jobs will likely be lost as the company starts to wind down.
Update: 21st May 2014 -
With 90 staff made redundant at the time Internacionale entered administration with more following over the last few months, there are reports of a further 26 stores now to close. This is a total of 300 redundancies so far.