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End of the line for Modelzone
MODELZONE in Basingstoke’s Festival Place will close next Thursday with the loss of eight jobs.
Administrators Deloitte decided to close the remaining 18 stores across the country after it failed to find a buyer for the toy and model retailer, resulting in 126 job losses.
Richard Hawes, joint administrator and partner in Deloitte’s restructuring services practice, said: “We sought to find a potential buyer for some or all of the stores, but unfortunately no viable offers have come in since our appointment two months ago.
“Modelzone has been generating losses over the past few years, largely through an increase in online competition and having taken leases on new stores that proved to be unprofitable.
“Once again, we would like to thank the company’s employees for their support and professionalism during this time.”
Before collapsing, Modelzone said it was the UK’s largest specialist model chain, with 47 stores employing 355 people.
At the time of going into administration in July, Deloitte said the retailer owed £8.4million to private equity firm LDC and £1.5m to trade suppliers, including model train producer Hornby and Pritchard Patent Product, which sells Peco model railways.
Deloitte estimated at the time that it would recover £4m for creditors through the sale of Modelzone stock but predicted that creditors would still face an overall shortfall of approximately £7m.
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