// Planet Organic puts administrators on standby in race to secure funding
// This comes as Waitrose called off talks to acquire a stake in the chain late last week
Planet Organic has put administrators on standby as it rushes to secure a rescue deal.
The organic supermarket chain has filed a notice of intention to appoint insolvency practitioners as it continues rescue talks, Sky News reported.
City sources said the retailer needed a multimillion-pound cash injection by the middle of April to survive.
Any sale of the supermarket chain could take place through a pre-pack administration process, although chief executive George Dymond is said to be focused on keeping the business intact.
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In a message to staff, seen by Sky News, Dymond said: “Over the past 12 months, we have been extremely busy fundraising in order to raise money to support the business and unlock our store expansion plan.
“Despite our wonderful stores being largely profitable, a herculean effort by the buying team to improve our margins and a huge improvement in the costs of running both stores and the e-commerce business, it is a fact that the business is still loss-making.
“While we have taken every possible action to improve our position, including additional investment from our existing shareholders, we have so far been unsuccessful in raising sufficient funds needed to support the business and the growth plan.
“In the meantime, however, we have had to take legal steps to protect the position of the business to afford us the time to be able to find a solution to the challenging situation we face, including filing at court a notice of intention to appoint administrators which is the first step in a potential administration process.”
Late last week, Waitrose called off talks to acquire a stake in troubled organic supermarket chain.
On Thursday, it was reported Planet Organic had temporarily suspended orders from suppliers while it sought out a rescue deal.
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