Woolworths’ administrators have reassured the store’s employees that they will be paid until after Christmas but said it was too early to talk about the future of the firm’s defined benefits pension scheme.
A spokesman for administrators Deloitte said no decision has yet been taken about the retailer’s final salary scheme. There are concerns that the Pension Protection Fund would be put under significant strain if it has to step in and pay members’ pensions, with reports showing experts estimate the deficits to be around £250 million.
A statement from Deloitte read: “I think that all we can say regarding the pension scheme at the moment is that we have been administrators for less than 48 hours and are working hard to assess the business, including taking advice to fully understand the pension scheme”.
Deloitte, however, has said its doing everything it can to find a suitable buyer for all parts of the business, which operates 800 high street stores, four distribution centres and employs 25,000 staff.
Neville Kahn, reorganisations partner at Deloitte, said: “Woolworths has suffered a number of cash flow. problems. Strenuous efforts over recent weeks to keep these companies going have unfortunately failed and the businesses are now looking to be rescued under the administration process. The companies were placed into administration and will continue to trade. Stores will remain open past Christmas and employees in stores will be paid.”
Dan Butters, reorganisation services partner at Deloitte, said: “We will be looking for a suitable buyer for all parts of the business. In the last 24 hours we have received expressions of interest from a number of parties for both retail and wholesale businesses. We are working hard to ensure that any sale of the business, in whole or part, will preserve jobs.”