Walmsley sinks into administration
Furniture chain Walmsley, which is based in Wednesbury, has become the latest victim of the slowdown in consumer spending after the retailer was forced to call in administrators.
The company has more than 60 stores across the UK, although 25 have already been sold to a new owner by administrators from insolvency firm Leonard Curtis. Details of the transaction have not yet been disclosed.
A Walmsley’s spokesman said: "A sale was completed immediately following the appointment to an unconnected company. The sale included all of the stock of the business and the buyer has taken over 25 of the stores."
It is thought that remaining stores are now being closed, with stock being transferred to the shops that are still trading.
Leonard Curtis has not confirmed how many employees have been affected by the company's collapse, but the business employed 293 staff when its last accounts were published for the year to 30 April 2010.
The failure is the retailer's second in the past six years after administrators were called in from Deloitte in late 2005. The company was then rescued by a new business called Unibrook, set up to complete the deal, and which included four shared directors.
Documents published at Companies House for Walmsley Furnishings plc – the business that collapsed in 2005 – show that the retailer failed owing more than £10m to creditors. This included more than £8m to businesses and other trade creditors.
Unibrook reported sales of £25.8m in the year to 30 April 2010, down from £27.4m a year earlier. But the business remained profitable, posting a pre-tax profit of £106,000.
Walmsley can trace its roots back to1933 and specialised in selling sofas, beds and dining furniture. It was formerly headquartered in Preston, before management switched its head office to Wednesbury in the Midlands.
In 2008, the company was accused of selling sofas that left people with rashes and burns. Walmsley, along with Argos and Land of Leather, was alleged to have imported sofas from China containing a chemical fungicide called dimethyl fumarate.
More than 5,000 people reportedly joined a group litigation and about 1,650 people are understood to have received compensation worth £20m. The chemical was subsequently banned.
