BUDGET high-street clothing chain Blanco has announced all its stores will now close and all 850 employees made redundant after having declared itself bankrupt for the second time in Spain and Portugal.
The company is said to owe all staff 23 days’ pay from November which is overdue, but unions say Blanco’s management is ready to negotiate the ‘best possible conditions’ for outgoing employees.
Closures of the brand’s 102 shops will be gradual, but will not start until the Mercantile Court of Toledo approves its second bankruptcy application.
The company, which has liabilities totalling €133 million, has applied to the court for permission to wind up – unlike the previous occasion when it went into receivership, in 2013 – and has already shut down its website right in the middle of the Christmas shopping season.
A message on Blanco.com says anyone with online orders placed will be contacted as soon as possible.
Last time Blanco went into receivership, it managed to pull itself back from the brink – the firm’s then owner, Bernardo Blanco, filed for bankruptcy on the chain’s behalf due to extremely serious financial and cashflow problems, but hoped to seek a viable future for the company.
It was duly bought out by AC Modus, a process which took nearly three years, but the new owners say the Spain and Portugal divisions have ‘failed to generate profits’, despite ‘every effort’.
AC Modus has spent the last two months seeking investors to keep the business afloat, but that this quest has ‘not borne fruit’.
The company launched its third mass redundancy procedure in September this year, but eventually scrapped it without any jobs being lost due to previous ‘restructures’ having led to 900 employees leaving prior to its commencing – although it has not been clarified whether they left voluntarily or were laid off.
Last year, ‘staff restructures’ affected 189 workers, although when Blanco went into receivership in June 2013, the process cost 711 employees their jobs.