Leeds-based fashion retailer Republic has confirmed it is going into administration.
Hunter Kelly, John Sumpton and Alan Hudson of Ernst & Young have been appointed joint administrators of Republic UK Ltd and Republic Retail Ltd. The administrators have already made 150 staff at the firm's head office in Leeds redundant.
Joint administrator and EY partner Hunter Kelly said: 'Republic suffered poor trading results in the autumn, and whilst sales picked up in December there has been a sudden and rapid decline in sales in late January. The impact on cashflows has resulted in the business being unable to continue to operate outside of an insolvency process.'
Kelly said the administrators will continue to trade Republic, with a view to selling the business as a going concern. 'The brand Republic is well recognised, particularly in the north. It has a powerful website offering, owns well-known brand names, and has some very attractive and profitable stores,' he said.
The company focuses on the youth fashion market and is owned by the private equity firm TPG, run by former Marks & Spencer executives, Luc Vandevelde and Roger Holmes.
TPG bought the company in 2010 in a deal thought to be worth about £300m and it has expanded quickly since then. Recently TPG has been forced to pump in more cash to keep the chain afloat, including a £20m cash injection in November 2012. At the time, TPG said it wanted to at least double the number of Republic stores in the UK and Ireland to more than 200.
TPG's chairman, Andy Bond, who was a former boss of Asda, is said to have left the company last week after two years. Its current chief executive is the former boss of TK Maxx, Paul Sweetenham.
Anusha Couttigane, a consultant at retail research group Conlumino, said the company's target youth market had been hardest hit by the recession and Republic had failed to keep up with its competitors.
Couttigane said: 'Despite TPG claiming that underlying sales have remained strong, annual accounts for January 2012 indicated that gross profits were down by 9.17% and it appears little has changed since then.'
Couttigane also said the group had recently hired KPMG to look at selling off some of its stores.
