Hundreds face axe over £10m Bonmarche deal

A judge is expected to give the go-ahead for the stricken chain to be bought by US-backed private equity firm Sun European Partners, which also owns the Alexon and Jacques Vert brands.

It is understood that Sun has earmarked more than 100 of the chain’s 394 stores for closure, threatening hundreds of workers with redundancy.

But the deal will safeguard most of the 3,800 jobs in the chain’s more viable stores.

Bonmarche, founded in 1982, was part of the Peacocks Group, which last week collapsed into administration under its £750m debt mountain in the biggest retail failure since Woolworths, placing 9,600 jobs in jeopardy.

But whereas administrators were called in to take charge of the Peacocks chain, Bonmarche had been kept out of administration to allow sale talks to continue.

Pre-pack deals, where a chain is placed into administration and immediately bought in a previously-arranged deal, are controversial because they allow the new buyers to take on the chain but write-off many of its debts.

Bonmarche, which is based in Wakefield and was bought by Peacocks in 2002, will continue to be run as a separate entity and will not be merged with Sun’s other retail brands.

The chain, which has 28 stores in Yorkshire, was originally founded by a family of immigrants from India, with the first store opening in Doncaster in 1985.

It now has an annual turniover in excess of £200m, with a distribution centre in Huddersfield.

The sale of Bonmarche will free up administrators at KPMG to look for a buyer for the Peacocks clothing chain, which has 563 stores nationwide.

It is understood that numerous private equity firms including Sun, and clothing firm Edinburgh Woollen Mill, are interested in buying the chain, while Tesco is also reported to be interested in some of its stores.

Private equity firm Op Capita, which is in the process of buying Comet from Kesa Electricals, is also expected to assess Peacocks’ potential.

A total of 50 firms are thought to have registered an interest, with initial bids expected by the end of the month.