Claire's to appoint administrator in UK and Ireland, putting 2,150 jobs at risk

The Guardian

a day ago

Claire's is on the brink of collapse after the fashion accessories retailer said it is to appoint administrators in the UK & Ireland, putting 2,150 jobs at risk.
The tween jewellery and ear-piercing retailer, which has 278 stores in the UK and 28 in Ireland, has struggled to arrest falling sales and competition from online retailers such as Amazon.
Claire's has filed a notice of intention to appoint the administrator Interpath, which will assess 'all options' for the company while it continues to trade.
Chris Cramer, chief executive of Claire's, said: 'This decision, while difficult, is part of our broader effort to protect the long-term value of Claire's across all markets.
'In the UK, taking this step will allow us to continue to trade the business while we explore the best possible path forward. We are deeply grateful to our employees, partners and our customers during this challenging period.'
The decision follows Claire's in the US and Canada filing for bankruptcy earlier this month.
Claire's, which also operates stores under the Icing jewellery and cosmetics brand, is owned by a group of firms, including the US hedge fund Elliott Management.
Will Wright, UK chief executive at Interpath, said: 'Claire's has long been a popular brand across the UK, known not only for its trend-led accessories but also as the go-to destination for ear-piercing.
'Over the coming weeks, we will endeavour to continue to operate all stores as a going concern for as long as we can, while we assess options for the company.
'This includes exploring the possibility of a sale which would secure a future for this well-loved brand.'
Interpath Advisory had been working to find a buyer for Claire's UK and European businesses, which has a combined workforce thought to be about 5,000, to avoid administration.
Last week it was reported that potential bidders for Claire's British arm, including the Lakeland owner Hilco Capital, had backed away from making an offer for the business.
There has been speculation that as many as a third of the UK shops might need to be closed if the chain is to survive.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: 'It looks certain that more stores will close, given the liability the store footprint has become for the company.'
Founded in 1961, Claire's has been a staple in British shopping centres and high streets. Products such as ear-piercings and on-trend jewellery made it particularly popular among teenagers.
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'Claire's attraction has waned, with its high street stores failing to pull in the business they used to,' said Streeter.
'While they may still be a beacon for younger girls, families aren't heading out on so many shopping trips, with footfall in retail centres falling. The chain is now faced with stiff competition from TikTok and Insta shops, and by cheap accessories sold by fast fashion giants like Shein and Temu.
'Having so many stores across the UK, used to be great for brand recognition, now names are recognised from social media feeds not building fascia.'
The retailer has two shops on Oxford Street in London and further branches in sites such as the Westfield and Brent Cross shopping centres and the O2 in Greenwich.
Claire's operates more than 2,750 stores across 17 countries in North America and Europe.
Its British arm has made losses of £25m over the past three years. The most recent figures showed it made a loss of £4.7m in the 12 months to the end of March last year, following a £5m loss the previous year.
The UK operation has an outstanding loan of $480m (£355m) that is due to be repaid by December next year.
The US operation previously declared bankruptcy in 2018 after it was unable to repay a loan but recovered seven months later after wiping about $1.9bn from its balance sheet.