Co-op’s disappointment over demise of successor
IPSWICH: One of the region’s biggest retailers today revealed its disappointment after the firm which took over its department and home stores went into administration.
Vergo Retail Ltd this week axed hundreds of jobs less than a year after clinching a takeover deal with the East of England Co-operative Society.
A number of stores, including one in Stowmarket, now face closure as administrators seek another buyer.
The Co-op signed off five department stores, six home stores and one jewellery store to Vergo in July last year to concentrate on the non-food market amid recession fears.
With four stores threatened with closure, the deal was seen as a welcome reprieve for staff.
Around 350 Co-op employees were transferred to the stores and Vergo was given a year rent-free in the Co-op premises as a sweetener.
But this week, administrators announced 335 job cuts with immediate effect – including, it is believed, 25 at the Ipswich store in Carr Street.
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Today Richard Samson, chief executive of the Co-op, said he was “very disappointed” at the news.
He said: “It demonstrates just how difficult the economic climate continues to be, especially in the retail sector.
“We hope the administrators are successful in finding other operators for all of the stores involved and that they are able to retain as many jobs as possible, especially at the stores in East Anglia.”
Joint administrators Sarah Bell and Steven Muncaster, partners at MCR, said closing down sales were due to take place at nine “loss-making” outlets. They are expected to close within the next four weeks.
Ten outlets, including Ipswich and Felixstowe, will continue to trade as usual for the time being.
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