LONDON (Reuters) - Deloitte, administrator to Entertainment UK (EUK), Britain’s largest wholesale distributor of entertainment products, said they will scale down efforts to sell the business as a going concern after failing to find a buyer.
It said on Friday that 700 employees have been made redundant from the firm’s head office and distribution centres in Middlesex.
EUK will continue to operate with a reduced workforce of 375 while Deloitte attempts to realise value from its assets.
EUK, part of Woolworths Group, was placed into administration, along with Woolworths’ 815-store retail business, on November 27.
“We have been unable to identify a suitable buyer for the business...We will now focus on realising value from the company’s assets,” said Dan Butters, joint administrator and reorganisation services partner at Deloitte.
On Wednesday Deloitte said it had failed to find a buyer for the retail business. It started a closing down sale on Thursday.
Deloitte confirmed that Bertrams Books, a unit of EUK, and 2Entertain, a DVD publishing joint venture between EUK and the British Broadcasting Corporation’s BBC Worldwide, will continue to trade as usual.
EUK’s administration has hit supplies to retailers such as Zavvi, J Sainsbury Plc, Wal-Mart Stores’ Asda and WH Smith Plc.
In a statement issued Friday 125-store Zavvi said that contrary to speculation its creditors have not drafted Ernst & Young into the business.
“However, Ernst & Young have been providing invaluable advice and expertise to the group over the past few weeks since EUK (Zavvi’s main supplier) was placed in administration,” it said.
Sainsburys said it would now deal directly with Bristol-based EUK supplier eXPD8 which had been rescued following its intervention.
Reporting by James Davey; Editing by David Cowell