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Mon 4 Jul 2011 08:35 AM

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Uncertain future for Jane Norman stores in the Middle East

UK fashion retailer that went into administration last week has seven stores in Gulf Arab region

Uncertain future for Jane Norman stores in the Middle East
(Image for illustrative purposes only)

UK women’s fashion retailer Jane Norman has not confirmed
whether its Middle East stores will close or not after the company went into
administration early last week.

In the Gulf the global firm employs more than 50 people
across seven stores in partnership with Majid Al Futtaim Fashions, which is
currently awaiting further instruction.

“Majid Al Futtaim is seeking clarity on the Jane Norman
situation in the UK,” said a spokesperson for Majid Al Futtaim in a statement,
adding that “at present” its stores remained open for business.

The firm was handed over to administrators from accountancy
group Zolfo Cooper last week after experience tough trading conditions and
struggling to pay back debts of £140m.

Founded in 1952, the company targets 16-25 year old girls,
and prides itself on producing “affordable adaptations of catwalk trends".

A third of its 94 UK stores have already been sold to
Scottish retailer The Edinburgh Woollen Mill, which has the option to buy a
further 28 stores. The remaining shops in the UK will be closed.

In the Middle East the firm’s stores include one in Bahrain,
three in Saudi Arabia and three in Dubai  – the future of which remains
uncertain.

The existing dilemma is in sharp contrast with the firm’s
status in 2008, when it celebrated a 30 percent rise in profits and announced
plans to open 30 standalone stores in the Middle East over the course of four
years.

At the time, finance director Ian Findlay told Retail Week
in the UK that there was still “profitable growth” to be had.

The high street brand was one of a string of UK companies to
go bust in recently as consumer spending reached an all time low, causing panic
among British retailers.

Other casualties have included Thorntons, TJ Hughes, Habitat
and Homeform, as well as high street names Moben, Kitchens Direct and Dolphin.

According to reports, UK retail sales fell 1.4% in May this
year, whilst clothing companies have also had to grapple with the soaring price
of raw materials such as cotton.

 

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