Nimmo and McAlinden of KPMG appointed joint administrators of Quiz stores
Blair Nimmo and Alistair McAlinden of KPMG have been appointed as joint administrators of Kast Retail Limited, which is the loss-making standalone division of the fashion retailer Quiz.
The two were appointed joint administrators by the company’s directors on June 10.
Immediately following their appointment, the joint administrators completed a sale of KRL’s business and the majority of its assets to Zandra Retail Limited – a wholly-owned subsidiary of Quiz Plc.
Established in 2009, KRL is a subsidiary of Quiz plc, the AIM-listed omnichannel fashion retailer, and a member of the wider Quiz Group of companies.
Headquartered in Glasgow, KRL operated 82 “Quiz Clothing” leasehold retail stores, located across the UK and Republic of Ireland.
As part of the sale, 822 of KRL’s employees have transferred to Zandra, with Zandra planning to operate from the majority of KRL’s former leasehold stores in the future. Unfortunately, KRL’s remaining 93 employees have been made redundant by the Joint Administrators, with trading at 11 stores having ceased permanently.
Like many high street fashion retailers, over recent years KRL has experienced trading difficulties, including falling footfall, declining average customer spend levels and rising operating costs. In response to the Covid-19 pandemic, and shortly prior to implementation of the UK Government lockdown on 23 March 2020, the directors elected to close all of KRL’s stores, with the majority of staff being placed on furlough.
To fund trading losses, KRL has received financial support from the wider Quiz Group.
Over recent months, KRL’s directors have undertaken an exhaustive process to explore options to preserve the KRL business, including COVID-19 Government support measures. Despite these extensive efforts, the directors concluded, ultimately, that KRL should be placed into administration.
Blair Nimmo said: “A combination of a highly challenging environment for bricks and mortar retailers during recent years and the COVID-19 lockdown have proven impossible for KRL to overcome. Despite their best efforts, the directors of KRL concluded that an Administration of KRL was unavoidable.
“First and foremost, our efforts will be devoted to assisting redundant employees with claims, including supporting their interaction with relevant Government agencies. We are already engaging with relevant employee support bodies. We are pleased to secure the sale to Zandra, as this will safeguard the KRL business, whilst protecting 822 jobs, and we wish Zandra every success for the future.”
Tarak Ramzan, chief executive officer of Quiz Group, commented: “It is with deep sadness and regret for some of our colleagues and partners that we had to take this decision to restructure the Quiz Group’s operations. The significant economic uncertainty coupled with the challenging economics of operating stores on traditional leases meant that, in order to ensure a sustainable future for the Quiz Group, we had to take this decision to place the subsidiary which operates our stores into administration.
“We continue to believe that stores, with appropriate property costs and flexible lease terms, can continue to be a relevant pillar in our omni-channel model and we will be seeking to re-open Quiz stores where we believe it is prudent and economic to do so. The Group remains confident in the relevance of the Quiz brand and its omni-channel model to deliver future sustainable growth opportunities both in the UK and internationally.”