Wakefield-based Bonmarché, a fashion retailer targeting the over-50s market, went into administration in October last year, after a sustained period of challenging trading conditions and cashflow pressure, which meant the business was unable to meet its financial obligations as they were due.
A spokesman for the administrators FRP said: “The joint administrators have identified Peacocks as a preferred bidder for Bonmarche.
“This is regarded as the best opportunity to maximise returns for creditors and sell the business as an ongoing concern.
“Negotiations with Peacocks are ongoing and further updates will be provided in due course.”
The spokesman added: “The administrators report states that there may be sufficient funds to make a disbursement to unsecured creditors – as you’ll appreciate much will depend on the what happens next in terms of the sale and the liquidation of any elements of the business that are not included within the sale.”
The Administrators’ Proposals report which has been published on Companies House states: “A data room was set up by the administrators whereby interested parties could access information about the company with a view to potentially make an offer to acquire the business and/or its assets.”
The deadline for bids to bids to buy the business was November 15.
Nine parties came forward with a firm interest in making an offer for part or all of the business, the report said.
“Having reviewed the various offers the administrators have chosen a preferred bid package from Peacock Stores Limited,’’ the report added.
“The transaction, which is subject to further due diligence and negotiations by the bidder with landlords, is regarded as the best opportunity to maximise returns for creditors and to sell the business on a going concern basis.
“While the administrators are optimistic that a transaction could be completed upon, the timescales for completion will depend upon the ongoing negotiations between Peacocks and BML landlords in respect of ongoing market rents.
“Accordingly, there remains a risk that the business could cease to trade if such negotiations are not satisfactorily resolved by all parties.”
The administrators said they had “regrettably” identified 14 underperforming and unsustainable stores which closed last month.
The report added: “The 300 remaining stores will continue to trade whilst the performance of the business is kept under review.
“A significant number of the trading stores are hoped to be part of the transaction with Peacocks, subject to a successful outcome of its due diligence process.”
Bonmarché was founded in Wakefield in 1982 by Sikh businessmen Gurchait and Gurnaik Chima. After running a successful network of market stalls, the first Bonmarché store was opened in Doncaster in 1985.
The company was acquired by the Peacock Group in July 2002, before being sold to Sun European Partners in 2012.
In April last year, it was announced that the chain was to be taken over by Philip Day, billionaire owner of Edinburgh Woollen Mill, who had purchased shares worth 52.4 per cent of the company.