Republic fashion retailer has fallen into administration jeopardising 1,600 jobs while becoming the next high-street casualty after HMV. Ernst & Young, which will handle Republic’s administration, has urged customers to spend their Republic gift vouchers, while the retail chain was still trading. The Leeds-based fashion retailer’s stores offer gift cards of different values, which can be redeemed in-store and online.
Customers are being requested to spend their Republic gift cards as voucher holders’ money is not protected if a company goes into administration. Instead, they will be classed as creditors and must line up with everyone else owed money by the failed company. Republic closed individual stores’ Twitter accounts last week after a HMV employee “live-tweeted” redundancies at the entertainment retailer, according to Drapers magazine. The fashion chain’s main corporate Twitter account, @RepublicFashion, failed to respond to question regarding administration.
Republic’s administration will mark the latest failure of a high-street retailer, following the demise of entertainment chain HMV, camera specialist Jessops and DVD rental firm Blockbuster last month, taking the job losses toll to 10,000. Although, it was expected that Republic would go into administration, the collapse in nonetheless a huge embarrassment for the US private equity firm TPG, which bought the clothing retailer in a deal worth £300m in April 2010.
TPG has twice been forced to infuse more cash to keep Republic afloat. In November 2012, TPG, Bond and Republic’s founders pumped in £20m. At the time, TPG said it wanted to at least double the number of Republic stores in the UK and Ireland to more than 200.
Republic, which owns 121 stores and sells brands including Diesel, Firetrap and G-Star, as well as its own-brand clothing, has suffered due to bad sales recently, as its young customers have cut back on spending and deserted it for rivals. Among the interested buyers, it is being speculated that Sports Direct may compete with other fashion rivals in looking to acquire a slimmed-down version of Republic out of administration.