Modella in deal to rescue half of Claire's UK, Ireland stores

(Sharecast News) - Private equity firm Modella Capital on Monday said it had agreed a deal to buy half of the UK and Irish stores of accessories chain Claire's from administrators, saving around 1,000 jobs although it warned of "inevitable" staffing cuts and shop closures. Modella bought 156 stores in the UK and Ireland from administrators Interpath, which also announced that it had secured a sale of the Claire's business in Switzerland and talks were also continuing in relation to the company's operations in France, Italy and Poland.

Natasha Harbinson, managing director at Interpath who led the sales process, said the sale would "ensure this popular brand will continue to trade on high streets up and down the UK".

Modella said it was "inevitable that this acquisition will result in some store closures and job losses" as started negotiations with landlords.

Around 1,000 staff at the 145 stores not bought by Modella are still at risk and will continue to be run Interpath, who stepped in after the group's US parent collapsed in August and started bankruptcy proceedings.

The retailer, which specialised in jewellery and ear-piercing called, suffered as sales fell amid competition from online in the face of competition from online marketplaces such as Amazon.

Modella bought Hobbycraft last year and more recently acquired took on the high street arm of stationer WH Smith's - rebranding it "TG Jones" with a play on the name and gap between the initial letters.

Will Wright, Interpath's UK chief executive and joint administrator, said: "Our intention is to continue to trade the remaining portfolio of stores for as long as we can, while we explore the options available."

Claire's was founded in 1961 and operates more than 2,750 stores across 17 countries in North America and Europe.

"As a firm, we strongly believe that this much-loved brand deserves the chance to remain on the high street in the UK and Ireland," said Modella managing director Joseph Price.

"The issues that Claire's is facing are significant, and we will need to work collaboratively with all interested parties if our proposed rescue plan is to succeed."

Modella said it had separately reached a deal for the licence to trade the Claire's brand in the UK and Ireland from Ames Watson, the US-based brand specialist which owns the intellectual property.

Reporting by Frank Prenesti for Sharecast.com