Administrators called in at MFI

Wednesday, 26 November 2008 05:30

MFI is to face administrators as the furniture giant became the latest victim of the economic crisis today.

MFI Group Limited has filed a notice of intention to appoint administrators.

Problems grew for the firm as it was revealed it was struggling to pay its rent - as the property slowdown and the credit crunch killed the UK's thirst for major furniture products.

MFI has over 100 stores across the UK and employs over 1,000 people.

Earlier today the union GMB warned if MFI could not secure a rent holiday it would be forced to close.

After the announcement a spokesperson for the GMB said: "We are still in the dark.

"Officials will be going to stores tomorrow to find out more of what is happening."

Tim Roache GMB regional secretary in Yorkshire, said "GMB members working throughout the group will not be surprised at this bad news as this company has been badly managed for some years.

"It is however disappointing that the landlords of the shops pulled the plug and did not give the management time to turn it around."

GMB on behalf of members in the shops, offices and depots will seek talks with the administrator to discuss what is due to happen next.

"GMB urge non union members throughout the firm to join the union to ensure their voice is heard," he added.

In September this year, MFI was subject of a management buy-out from Merchant Equity Partners (MEP), which itself had bought the firm for £1 in 2006.

The MFI's former manufacturing arm Galiform, which was spun off as a part of the 2006 deal, stated it was "saddened these developments".

Galiform is the guarantor of the rent and costs for 46 MFI stores.

• Tags:
• investment advice
,
• news