Leicestershire jobs saved after stricken Dreams is bought
Jobs have been saved after beds chain Dreams was taken over by a new owner.
Two stores in Leicester and one in Loughborough, employing a total of 10 staff, have been safeguarded after most of the collapsed retail group was bought by private equity firm Sun Capital Partners.
Dreams went into administration yesterday, with 171 of the 266 stores being bought by Sun Capital today in a so-called “pre-pack” deal.
The move has saved about 1,600 of the group’s 2,000 jobs.
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The safeguarded stores include those in St George’s Way, Leicester and Counting House Road, Freemen’s Common, in the city. The Loughborough store is in Willowbrook Retail Park, off Derby Road.
Joint administrator Alan Hudson, of accountants Ernst & Young, said: “High street retailers have faced unprecedented conditions over recent years, and the market for higher value discretionary purchases has been particularly tough.
“Dreams is a well known market leader, but in common with many others has suffered as a result of this depressed retail environment, a rapid expansion of its store portfolio and onerous lease liabilities. Whilst recent performance has improved, it has seen a decline in like for like sales across its store portfolio as well as its operating margins being squeezed. This has resulted in the business being unable to continue to operate outside of Administration."
“However, we are pleased to announce that a sale has been completed that sees the majority of the Dreams business including 171 of its stores, its head office and its two UK manufacturing facilities being sold to a new company controlled by Sun Capital Partners. The business will continue to trade without interruption, over 1,600 jobs have been transferred and the future of Dreams on the UK high street has been safeguarded.
“The remaining stores that are not included in the sale will remain open for business whilst the
administrators seek to find buyers for these stores.”
In pre-pack deals, a buyer is lined-up to buy a company’s assets before it goes into administration and sheds certain debts.
Sun European also owns SCS, a sofa chain, and Moben and Sharp kitchens. It paid £35 million to take control of Dreams, which was bought by Exponent private equity for £220 million from founder Mike Clare in 2008. Dreams owed about £60 million to its banks.