Thursday, December 18, 2008

Woolworths to close all stores by January 5 [UPDATED]

Woolworths to close all stores by January 5 [UPDATED]
Staff informed of retailer’s decision to close doors for the final time in New Year after administrators fail to find a buyer.

Administrator Deloitte has confirmed that all 807 Woolworths stores will close by January 5.

The financial specialist has abandoned its attempts to find a buyer for the retail chain Woolworths or entertainment distribution arm EUK as a going concern.

Closures will commence on December 27 with 200 stores shutting their doors, followed by another 200 on December 30. This will continue on January 2 and 5.

A total of 27,000 full-time and temporary staff will lose their jobs across the stores.

Branch managers received the news by email. They were informed not to speak to the press and the branch contacted had been given very little information about its future.

The distribution centres supporting the stores, which employ around 500 staff are likely to close before the end of December.

It has been confirmed that 300 of the stores are still 'under offer', with bids from a number of food, clothing and discount retailers. Deloitte revealed that there is also 'considerable interest' in the other 500 stores.

All employees will be paid until the end of December and the administrators have said that 'staff will be retained for a period following the store closures'.

Deloitte added: "The administrators are working closely with the Redundancy Payments Office and Job Centre Plus to provide support for all staff, which will include a fast track process for paying redundancy entitlements."

Neville Kahn, joint administrator at Deloitte said: “Whilst negotiations for the sale of Woolworths’ retail arm remain ongoing, and we continue to speak to new interested parties, regrettably we have had to begin a store closure programme. We are extremely grateful to the staff and management for their support throughout this difficult time.

“We are confident that we will sell the leases of the 300 stores currently under offer and are hopeful that our ongoing discussions with other parties will also prove successful.”

Meanwhile the closing down sale continues across the stores, with discounts of 20%-60%. 50 million new stock items will be received into stores this week where further discounts will be applied in due course.

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