Wednesday, 4 February 2009

Iceland's crash takes a bit out of the UK high street

Remember the time when Icelandic investors were buying the high street. Now it is all unwinding:

The future of Baugur, the Icelandic group that holds stakes in many British high street retailers, was thrown into confusion today after efforts to restructure its debts collapsed. The company, which owns stakes in Hamleys, House of Fraser, Debenhams, French Connection, Karen Millen and Goldsmiths, has applied for bankruptcy protection in the Icelandic courts. It blamed the move on Landsbanki, the Icelandic bank that was nationalised late last year.

Baugur said the move would protect its assets as well as the interests of its creditors, who are owed around £1bn. Analysts said the collapse of Baugur will prompt a major shakeup on the UK high street.

Iceland as a top player in the UK retail sector; it was always too weird to be true.


Anonymous said...

Aye, it always was fishy.

mike said...

Since these are assets in the UK then I hope & expect the UK creditors to come first. Hopefully some of the 4 billion owed effectively to UK taxpayers will be recovered.

Anonymous said...

Does Landsbanki also handle the wages of all these companies, and will the employees find that they are without pay until these assets are sold off?