The once great high street retailer Woolworths appear to have hit rock bottom and is in talks with restructuring specialist Hilco, with talks at ‘the very early stage’ according to Hilco’s chief executive Paul McGowan.
Woolworths have around 800 retail outlets alongside a profitable DVD publishing and distribution business. While the shops are struggling on a daily basis the DVD division shows a projected profit of £70 million.
The retail arm however is seen as a liability, it’s running costs amount to £8million, with interest charges of £30million and a group pension charge of £17million.
It is believed that Hilco could possibly buy Woolworths for a nominal £1 and take on the companies current debt, there does seem to be a stumbling block however as Hilco are not keen on taking on the group pension.
Woolworths posted a record first half underlying pre tax loss of £90.8million in September on a turnover of £1.11billion.
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1 Time is running out for Woolworths | UK Business News // Nov 24, 2008 at 4:35 pm
[...] have allegedely made Woolworths a token offer of £1 for the business, as posted here last [...]