British home shopping company Studio Retail Group’s (SRG) board is set to appoint administrators in a move that could put a number of jobs at risk.
The company, previously known as Findel, filed a notice of intent (NoI) after failing to secure an ‘urgent’ £25m ($33.86m) loan from its bank, HSBC.
SRG had its shares suspended on the London Stock Exchange as a result.
In a statement, the company said: “As announced on 31 January, Studio has surplus stockholding that requires additional working capital funding while this good quality stock is sold through to customers.
“The company requested a short-term loan of £25m from its lending banks to fund the surplus stockholding, which, it believed, was sufficient to enable it to sell through the stock to customers.
“Following detailed discussions with our UK lenders, the company has not been able to reach an agreement with them to provide the additional funding Studio requires.
“The Board therefore now intends to file a notice of intention to appoint administrators to SRG and Studio Retail Limited, its wholly owned subsidiary, as soon as reasonably practicable.
“The Board is taking this action to protect the interests of its creditors.”
The call for administrators comes after SRG recorded a 10% decline in sales for the third quarter of the fiscal year 2022 (FY22) compared with a year earlier.
The company said it would aim to sell unsold stock from its continuity ranges, which had arrived late due to supply chain issues, this year.
SRG currently serves around 2.5 million customers and registered £578.6m in sales during the last financial year.
Originally a catalogue gift retailer, the company has expanded online to sell clothes, home and electrical products on flexible payment terms.
It is backed by Mike Ashley’s Frasers Group, which holds a stake of around 29%. Ashley tried to take over the business in 2019, but this was unsuccessful.