Shoe retailer Faith in administration

Footwear chain Faith collapsed into administration today in a move that puts 1,700 jobs at risk.

The ailing retailer has been put up for a sale for a number of weeks but administrators Mazars said they were called in after directors realised that a “solvent sale was not possible”.  Heath Sinclair of Mazars said: "We are currently liaising with interested parties in an attempt to facilitate a going concern sale. We will be working closely with the businesses' stakeholders in an effort to preserve a well known retail brand. We are in the process of communicating with all staff, concession partners and suppliers and will seek to keep them updated as the process develops."

The young fashion footwear chain also operates 120 concessions within Debenhams and Topshop’s flagship store on Oxford Street.

The administration also hits FEC Holdings, Faith’s parent company.

In 2008 the financial health of the company was called into question after previous owners, private equity firm Bridgepoint Capital, were forced into a fire-sale after failing to reach agreement with lender Barclays. A management team led by former owner of Dolcis Shoes, John Kinnaird, stepped into rescue the firm. Bridgepoint bought the business in 2004 for £64 million from Jonathan Faith, son of Samuel Faith, who founded the business in 1964.

It is believed that restructuring specialist Hilco has completed a deal to buy the firm’s debt from investors and lenders.

Posted at 09:06PM Apr 22, 2010 by Kelly Board in Insolvency  |  Comments[0]

UK Borrowing at Record High

Government borrowing hit a record high of £163.4bn this year, official figures have shown.

The borrowing figure for the 2009-10 financial year is lower than the £166.5bn predicted by Chancellor Alistair Darling in April's Budget.

Including financial intervention measures, borrowing totalled £152.8bn - lower than the £155.9bn forecast.

It is the biggest annual borrowing figure for a UK government in peacetime.

A further £23.5bn was borrowed in March, the figures from the Office for National Statistics (ONS) showed.

Borrowing in March is typically high as civil servants seek to spend the remainder of their annual budgets.

Total government debt now stands at £890bn - equivalent to 62% of GDP.

The £163.4bn borrowed is equivalent to 11.6% of GDP.

Although the annual figure came in below the Budget prediction, City analysts reacted cautiously.

"The big picture is that this is still the biggest budget deficit since the Second World War," said Jonathan Loynes, economist at Capital Economics.

"With all parties' fiscal plans based on extremely optimistic economic assumptions and unspecified spending cuts, a further sizeable fiscal squeeze will still be needed after the election, whoever is in charge."

Borrowing came in lower than expected partly as a result of a 3.8% increase in tax income in March.

Income from VAT also rose following the return to the 17.5% rate at the start of the year, and corporation tax receipts were up by more than 50%.

Posted at 03:34PM Apr 22, 2010 by Marc Stenton in The Economy  |  Comments[0]