Fears for jobs as store seeks buyer

STAFF at Ethel Austin stores in the Oldham area were left fearful for the jobs today after the 76–year–old discount retailer called in administrators for the second time in two years.

Ethel Austin has stores in Market Street, Shaw, Chadderton Precinct and the Arndale Centre in Middleton — part of a network of nearly 300 stores and its sister homewares chain Au Naturale.

The group, based at Knowsley, Merseyside, only 10 miles from where the business was founded by Ethel Austin and her husband George Austin in their Liverpool council house in 1934, has appointed MCR as administrator after the business failed to turn around following its rescue from collapse in May, 2008.

There are 3,714 staff employed across Ethel Austin and Au Naturale, including 400 head office staff.

The jobs now hang in the balance as MCR seeks to find a buyer.

The administrator said it could not rule out store closures and redundancies as it goes through the embattled retailer’s books.

The Shaw store only opened in September last year in the former Woolworths branch in Market Street, itself a high-profile victim of the credit crunch.

Ethel Austin was bought out of administration in 2008 by Elaine McPherson, the previous chief executive and joint owner of MK One.

She pledged to return Ethel Austin to its “former glory” with an overhaul of the stores and clothing range.

The move helped protect 2,500 jobs at the time, although more than 450 jobs and 33 stores were earlier axed by administrators.

But the group has come under pressure from rival budget chains such as Primark and Matalan, while the financial crisis affected its financing plans. MCR today said the recent funding woes were compounded by the bad weather at the height of the key January sales period.

Geoff Bouchier, partner at MCR, said Ethel Austin would trade as normal while a buyer was sought.

But he added that “in the current economic climate there are no guarantees that purchasers will be found”.

Usdaw, which represents 700 of the workers, said the news was a “terrible blow”.

National officer John Gorle said: “The announcement that Ethel Austin has again gone into administration isn’t a complete surprise as we were aware that the company had some financial difficulties.

“We have already made contact with the company and the administrators with a view to working closely with them in an attempt to secure the employment of all staff.

“Today’s announcement is terrible news for the loyal and hardworking staff, who now face a period of uncertainty surrounding their future.”