The owner of Edinburgh Woollen Mill has secured a deal to rescue the brand and its sister business Ponden Homes from disappearing for good after it crashed into administration last year.
Administrators at FRP confirmed 246 stores will be saved by Purepay Retail, which is controlled by former owner Philip Day. The deal secures the future for 1,453 workers.
The new owner will operate under licence across both brands, saving 1,347 shop workers, 72 employees at head office and a further 34 jobs at the company’s Carlisle distribution centre.
However, 85 Edinburgh Woollen Mill and 34 Ponden Home stores have been permanently closed as part of the agreement. Another sister brand to EWM, fashion chain Peacocks, remains in administration.
Tony Wright, joint administrator and partner at FRP, said: “We have extensively marketed these businesses for sale and this transaction provides the best chance to save stores and jobs, but also meet our own statutory obligations to creditors.
“However, with such little visibility on future trading conditions in UK retail, we regret that not all of Edinburgh Woollen Mill and Ponden Home could be rescued.
“This has resulted in a significant number of redundancies at a particularly challenging time of year and period of economic uncertainty.
“We have a team working hard to support all those affected as we help make applications for redundancy payments.”
Former owner Mr Day was a major secured creditor when EWM collapsed in November.
The Dubai-based businessman is behind the deal to rescue the retailer and lined up a series of international investors who will provide the cash it needs to continue trading.
It will see EWM continue to be controlled by Mr Day with new investors repaying him the money owed as a secured creditor.
Unsecured creditors including landlords and suppliers are unlikely to get back any money owed.
The deal will come too late for some staff too, with around one third of the 2,571 employees already made redundant.
Edinburgh Woollen Mill Group became one of a string of retailers embarking on a major restructuring during the Covid-19 pandemic when it called in administrators in October.
The high street has faced a double blow since coronavirus restrictions added to the pressure already being exerted by changing shopping habits as customers turn to online retail.
Cath Kidston, Laura Ashley and Oasis were among the retailers that entered administration last year.
On Monday, Marks & Spencer signed a deal to take over Jaeger, another part of Mr Day’s business empire which also entered administration last year. However, M&S did not buy the Jaeger stores, so no jobs are expected to be saved.