Zavvi placed into administration, Officially

I wrote on the 11th December here how I thought that Zavvi would be the next big retailer to fall, I followed this up on 12th December by writing about how EUK (Woolworths) had lined up Ernst and Young as possible administrators for Zavvi if they (Woolworths) could not get their £107 Million back.

I also wrote again here on 16th December how Virgin Group were purchasing stock for Zavvi group and that I thought that Branson would not let the retailer fall.

Today on Christmas Eve, it pains me to write that Zavvi has indeed fallen into Administration and 3400 jobs are now at risk if Ernst and Young cannot either find a buyer or find away to steer the chain on good waters again.

Zavvi Ireland, a subsidiary company of Zavvi UK are not currently subject to Administration as they operate in a different legal area.

The groups management and partners, Simon Douglas and Steve Peckham have commented

“We have done all that is possible to keep the business trading, but the problems encountered with EUK, and particularly its recent failure, have been too much for the business to cope with.”

Virgin Group and Richard Branson are yet to comment.  Its a shame that another succesful British business has fallen in such a way and 3400 staff are now wondering over Christmas what is happening with jobs etc.

For me, the real interest will be what move Branson plays next, although he sold the firm in 2006 he still has quite a bit of cash and assets tied up in Zavvi, not to mention the retail space within Zavvi that Virgin Media rents, there only retai presence.