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Examinership for B&Q Ireland
- 05 February 2013
DIY chain B&Q Ireland Ltd has been placed into interim examinership following a hearing at the High Court this afternoon. This gives the company protection against its creditors for up to 100 days while the DIY chain attempts to restructure the business and formulate a survival plan to put the business back on a viable financial footing.
Declan McDonald of PwC has been appointed as interim examiner. Under a proposed restructuring, stores in Athlone and Waterford – which employ 92 staff - would close. B&Q will also attempt to substantially improve its rental agreements with landlords.
B&Q said it will continue to trade as normal during the examinership process. All staff and suppliers will continue to be paid and gift vouchers and credit notes will be honoured during the process. The company has nine stores in the Republic and employs 690 staff.
B&Q entered the Irish market in 2002 with a flagship large warehouse store beside the Liffey Valley shopping centre in Dublin. It has made significant losses in the past two years due to the decline in consumer spending in the Irish housing sector since late 2008.
Its last published accounts show the company made a loss of €3.3 million in the year to the end of January 2012. Losses in the current year are expected to exceed €10 million. This prompted parent company Kingfisher to withdraw financial support for the Irish business.
In a statement, Brian Mooney, chairman of B&Q Ireland Ltd said: "The management team is hopeful that a sustainable business can emerge from the examinership process, based on a restructuring of the company." Retail Excellence Ireland said the news was no surprise, and predicted others would follow, blaming the "rigorous enforcement of Celtic tiger rents" by landlords.
"We have clearly stated to successive Government that the continued existence of upward only rent reviews is causing significant damage to job numbers and the ability of retailers to remain trading. The majority of retail tenants now pay more on their rent than on their total labour force," said REI chief executive David Fitzsimons said.
"If Government does not legislate, 2013 will witness an unprecedented level of retail industry failure."
Source: Irish Times - Examinership for B&Q Ireland
