In February, the retailer’s shares dropped by 41%
Fashion and furniture chain Laura Ashley has filed for administration as the coronavirus pandemic continues globally.
Rescue talks were stifled by the impact of the coronavirus on businesses.
In a statement, Laura Ashley said: ”For the seven weeks up to 13 March, trading for the Laura Ashley business improved by 24% year on-year and the directors were encouraged by this strong performance.
”However, the Covid-19 outbreak has had an immediate and significant impact on trading, and ongoing developments indicate that this will be a sustained national situation.”
This situation could increasingly become more common across the UK market, as many businesses do not have sufficient insurance to compensate them for coronavirus losses.
All options explored
While discussions with the organisation’s stakeholders had been ongoing, Laura Ashley’s directors are now in advanced talks for the provision of third-party debt funding.
However, company directors, its key trading subsidiary, known as Laura Ashley, and associated businesses Premier Home Logistics, Laura Ashley Investments and Texplan Manufacturing have all come to the conclusion that ”all available alternative options have been explored”.
The statement added that in order to protect creditors, it is necessary to file a notice of intention to appoint administrators in respect of the company and each of the named subsidiaries.The two administrators are Robert Lewis and Zelf Hussain.
Laura Ashley has asked for its original shares to be suspended from the premium listing segment.
Back in February, the organisation called for funding as its sales fell by 10% and shares plummeted by 41%.
The news follows Flybe filing for administration just two weeks ago for the same reason.
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