Job fears as clothes chain D2 collapses

Published on Thursday 31 December 2009 10:20

The collapse into administration of fashion chain D2 Jeans has put nearly 800 jobs at risk, it was reported today.

D2 Jeans, originally set up by Scottish entrepreneur Sir Tom Hunter, became the first post-Christmas retail casualty yesterday when it was placed in the hands of administrators BDO.

According to The Times, BDO has received at least seven expressions of interest in the Ayrshire-based firm, which was bought by management in January 2008.

All 76 UK stores are to continue trading while a buyer for all or part of the business is sought.

But 22 people have been made redundant at the firm's headquarters in Dundonald, Ayrshire, and two of the three stores in Dublin, Ireland, have been closed with the loss of 39 jobs.

It is understood the retailer's problems stem from its rental agreements, which locked it into secondary high street locations.

D2 Jeans is believed to have posted a pre-tax loss of 2.9 million in the year to January 2008 – the most recent period for which figures are available – after a 1.9 million loss the previous year.

According to the report Sir Tom gave a confident appraisal of the retailer's prospects in 2001.

"Back in 1998, people were saying that Jeremy Clarkson had killed off the jeans market," he is reported as saying.

"But it bounced back. Really, it will never go away."

Sir Tom, who has pledged to give at least 1 billion to charity during his lifetime, has seen several of his former investments face difficulties this year.

JJB Sports put its Qube footwear stores into administration in February, having purchased them from Sir Tom's West Coast Capital just months before for the nominal sum of 1.

The Birthdays card chain – also briefly owned by West Coast Capital – was put into administration by its owner Clinton Cards this year. Its profitable stores were then bought back.

It is understood administrators think D2 Jeans has "substantial" levels of stock, enough to keep the stores open while a buyer is found.

James Stephen, BDO business restructuring partner, said: "It is unfortunate that the economic climate and difficult trading conditions have significantly affected the retail sector.

"We are continuing to trade the business and hope to sell all or part of the company as a going concern."