White knight Ellie Louise follows Happit into administration

By PETER RANSCOMBE
Published on 03/04/2012 00:00

ELLIE Louise, the women’s fashion chain that bought collapsed Dunfermline-based retailer Happit, has itself fallen into administration after a series of takeovers “detrimentally” affected its cash flow and profit margins.

The Leeds-based company – which operated shops under the Budget Box, Ellie Louise, Gimbles, Happit, Seconds Ahead and Trade Secret brands – has 97 stores in the UK, including 22 north of the Border.

In total, the firm employs 421 staff in its branches and a further 18 at its head office.

Happit went bust in 2008 and was bought by Second Thoughts, which in turn went to the wall in 2008, when Ellie Louise stepped in. Both Ellie Louise and Second Thoughts were run by the same family. Documents filed at Companies House listed Gurchait Singh Chima as Ellie Louise Trading’s only shareholder.

Gurchait and his brother, Gurnaik, reportedly pocketed nearly £10 million each after selling their Bon Marche women’s fashion chain to Peacock’s in 2002 for £51.3m. The pair had started their business lives together by running a market stall in Huddersfield.

Graham Wild, a partner at the accountancy firm Zolfo Cooper, which was yesterday appointed as the administrator, said: “Unfortunately – as with many other fashion retailers exposed to declining consumer spend – challenging trading conditions have led to increased financial pressure on this well-known brand.

“The company has also been adversely impacted by a number of issues arising from the acquisition of the Trade Secret brand during 2010. This has accentuated the cash-flow strains the business has faced and meant the director had no choice but to seek protection via an administration.

“We intend to trade the business in order to ensure that we identify the best possible outcomes regarding preservation of jobs, the value of the business and returns to creditors. We will make further announcements as appropriate”