Carpetright to close 200 stores following Tapi rescue deal
Carpetright could close around 200 of its stores under the terms of a rescue deal from rival Tapi Carpets.
Tapi has acquired the flooring retailer’s intellectual property, 54 of its stores, and two warehouses, leaving the future of 218 remaining stores in doubt.
Jeevan Karir, managing director of Tapi said a full rescue was “unviable”, due to Carpetright’s “materially loss making” business and its “significant debt”.
The retailer was also wary of any scrutiny from the competition authorities.
Zelf Hussain, joint administrator at PwC, which was hired by Carpetright to find a buyer, added: “Carpetright has fallen victim to challenges facing many retailers, especially those selling big ticket items. A mixture of factors, including a big reduction in consumer spending due to cost of living pressures, lower home sales and a debilitating cyber attack made it impossible for the business to continue in its current form.
“The sale of some stores and the brand to Tapi has allowed over 300 jobs to be saved, and gives the Carpetright brand the chance to continue and flourish under its new ownership.
“However, it is deeply saddening that for the remainder of the workforce there will be redundancies. We are committed to helping those affected and will make sure redundancy claims are processed as quickly as possible. In collaboration with Tapi, we will assist in efforts to help individuals find new jobs elsewhere.
“We know this is an uncertain time for many of those affected and want to thank all the staff for the support they have given the company in these difficult circumstances.”
Carpetright appointed PwC earlier this month, after confirming that it had filed a notice of intent to appoint administrators. The retailer said it had taken the measure whilst it works to “finalise additional investment to secure the long term future of the company”.
Carpetright – which has struggled with a downturn in trading over the last few years –went through a form of insolvency proceedings in 2018 resulting in the closure of a number of stores.
In April, it was reported that the retailer had drafted in advisers from Teneo as it looked to explore cost-cutting options.