DIY chain calls in Ernst & Young following poor performance during recession and failure to secure rescue deal
Nearly four thousand jobs are at risk after Focus DIY, Britain's fourth-largest DIY chain, today called in administrators after failing to clinch a rescue deal.
Ernst & Young will be appointed at midnight after the company, which struggled during the recession, admitted that it was close to a default on huge debts and "that there were no alternatives that could be explored any further".
"The directors have sought consent from the business's lenders to appoint E&Y as the administrators. All stakeholders including staff are being informed," Focus said in a statement.
Its website stopped taking online orders this afternoon, citing a "technical issue". The chain has 178 stores and employs 3,919 people.
The company was reportedly in talks with restructuring firm GA Europe, but failed to agree a deal. Its US private equity owner Cerberus began to look for a buyer for the chain last autumn.
Focus was born in 1987 when its founder, Bill Archer, quit Crown Paints to set up a DIY business with £300,000 from remortgaging his house. He and a former business partner bought two small chains, Choice DIY and Focus, and rebranded all 12 stores as Focus DIY.
Four venture-capital firms subsequently backed him in a £4.5m buyout of the Focus DIY chain. The business grew rapidly by acquiring rivals Do It All, Great Mills and Wickes (the latter sold no to Travis Perkins in 2005). The group was bought by Cerberus, which took on debts of £180m, for £1 in 2007 and hired former Wickes boss Bill Grimsey to turn it around.