Jobs saved as childrenswear retailer Adams is sold

This article is more than 12 years old
Sun 15 Feb 2009 13.49 EST

About 1,900 jobs have been saved after Adams Childrenswear was bought out of administration by its former owner, the Northern Ireland businessman John Shannon.

The retail chain, which has 120 shops still open throughout the UK and Ireland, went into administration on New Year's Eve, one of a string of failures on the high street as Britain has fallen into recession. Since then 147 outlets have been closed with the loss of about 1,100 jobs.

The administrator, PricewaterhouseCoopers, declined to say how much the business had been sold for.

Shannon, 58, has held positions in retailers including Country Casuals, Laura Ashley and Moss Bros. This is the second time he has bought Adams out of administration.

In February 2007 he paid £15m for the business, the move led to the closure of 42 stores. He sold his stake in shoe retailer Stead and Simpson, where he had been chairman, to fund that deal.

Since then worsening sales have made it harder for the firm to shoulder its £30m of debt. Competition from supermarkets and other high street retailers has meant it has struggled to find a niche for itself.

Adams, based in Nuneaton in Warwickshire, is the largest independent childrenswear retailer in the UK and had an annual turnover of £150m before it went into administration. The firm sells babywear, school uniforms and clothes for children aged from two to 10.

"We are delighted to be able to secure this business sale and provide some much needed stability for customers, suppliers and employees alike in these uncertain times," said Rob Hunt, joint administrator.

The new company will continue to trade under the Adams name. The business was founded in 1933 by Amy Adams, who sold clothing for babies out of her Birmingham home.

The high street has been savaged by the recession, with retailers including Woolworths, Land of Leather, Zavvi and Whittard of Chelsea going into administration over the past few months.

A further 17,000 high street jobs are currently under threat at JJB Sports as its lenders negotiate a debt restructuring for the retailer and 5,400 jobs are in the balance at stricken footwear chains Barratts and Priceless Shoes. There were reports yesterday however that Michael Ziff, chairman of the shoe chains' parent company, was preparing a bid for part of the business.

About eleven retailers will become insolvent in the first quarter of the year, trade body R3 recently warned.

"The official quarter four insolvency statistics will begin to show the business failures caused by the recession," R3 president Nick O'Reilly said. "Our survey shows that UK insolvency practitioners believe that we have not yet seen the worst. An overwhelming majority of insolvency practitioners believe that this downturn will be deeper than the 1990s recession; over two thirds think this one will last longer, and three quarters think more businesses will close this time around."

Corporate insolvencies will peak at 19,796 in 2009, slightly falling to 19,202 in 2010, when the economy is expected to start recovering, R3 said.