Outdoor apparel and equipment retailer Blacks Leisure has confirmed today that a sale of all of its trade, assets and brand is only likely to be completed once it has formally entered administration.
Several interested parties will now wait until Blacks enters administration before submitting their offers, in what is known as a pre-pack deal, with partners at professional services firm KPMG Brian Green, Richard Fleming and David Costley-Wood set to be appointed administrators.
The firm‘s ordinary shares have been suspended from trading on the London Stock Exchange with immediate effect and a sales is expected to be completed in the next few days.
A statement from the retailer read: “The board has now determined that any sale of the trade, assets and brands will be effected through an administration process.
“Therefore it is expected that the process to commence the appointment of administrators of the company and certain of its subsidiaries will begin shortly although the actual appointments are only likely to take effect just before the completion of any such sale.
“The operating subsidiaries of the group will therefore continue to trade through all outlets outside of an administration pending any sale.”
Pre-pack administration allows companies to preserve the continuity of the business while arranging a sale and often results in jobs being preserved but they can be controversial as they often leave creditors out of pocket.
Blacks was forced into looking for a buyer after its new management team, lead by CEO Julia Reynolds and Chairman Peter Williams, realised its turnaround strategy alone would not save the ailing business.
Many had suspected that major shareholder and fellow UK retailer Sports Direct International would attempt a takeover, but they pulled out of any acquisition before the end of last year.