Yahoo Finance Coronavirus: UK arm of shoe retailer Aldo collapses into administration
Canadian shoe retailer Aldo has appointed financial services firm RSM as administrators of its UK division, putting the jobs of employees at its 13 stores in the country at risk.
In a statement, Aldo noted the impact of the coronavirus pandemic, pointing to “historic profitability challenges and the unprecedented collapse in retail spending in the UK and globally.”
The chain thus said it was necessary to appoint administrators to oversee an insolvency process.
“It is a difficult decision to close our stores in the UK market, but it is unavoidable given the current business environment and the impact of the COVID-19 pandemic,” said Aldo chief executive David Bensadoun.
“We thank our associates, customers and vendors in the UK for being a part of our story since 2002.”
READ MORE: Eurozone manufacturing recovers slightly but situation still bleak
Five of Aldo’s stores in the UK were closed immediately as a result of the move, while the remaining eight will continue to trade as the administrators assess the viability of their operation.
It is not known how many employees have been affected by the closures.
The collapse of the company’s UK arm does not impact the availability of footwear from its online platform, or where its products can be purchased at other stores, such as Selfridges and House of Fraser.
Last month, Aldo filed for bankruptcy protection in Canada, appointing financial services firm EY to oversee a court restructuring process designed to stabilise its business.
READ MORE: EU hopes to raise €10bn a year from new corporate tax
Commenting on that move, Aldo said it would “work to complete its restructuring in a timely fashion and hopes to exit from the process as soon as possible and better positioned for long-term growth.”
Later in May, Aldo also appointed RSM to oversee the liquidation of its business in Ireland, where it had four stores.
The company said that the pandemic had put “too much pressure” on its operations in the country, and it has since ceased shipping online orders to the country.
The coronavirus pandemic has put immense pressure on the retail industry. Non-essential stores were forced to close as part of a UK-wide lockdown, while demand has plummetted.
