Specialist model retail chain Modelzone has entered administration following Tuesday’s third-quarter rent day.
Richard Hawes, Nick Edwards, and Rob Harding were appointed as joint administrators to Modelzone Holdings Limited and certain of its subsidiaries, including Amerang Limited.
Hawes, partner at Deloitte, said the company had been “historically profitable”, but had suffered from entering into leases for new stores that proved to be loss-making.
He explained: “This, coupled with the growth in online competition, has resulted in Modelzone generating losses over the last couple of years, which the board of directors has now concluded is unsustainable and sought the appointment of administrators.”
“We are working closely with customers and employees to ensure the business has the best possible platform to secure a sale, preserve jobs and generate as much value as possible for all creditors.”
Modelzone currently operates from 47 leasehold stores throughout the UK and rising retail lease costs have pushed the company into administration.
Modelzone subsidiary Amerang Limited is a wholesaler of toy and hobby trade products. Together the group employs approximately 400 staff.
Hawes said: “Amerang is a profitable business, but the directors were forced to seek the appointment of administrators to protect the value of the business following the administration of Modelzone, its sister company.
“Amerang remains profitable and we will continue to trade as normal while we seek a buyer for all or parts of the business as a going concern.”
During this time gift vouchers will be honoured towards 50% of the purchase of goods.