Blacks and Millets collapse puts 3500 jobs on the line

Blacks Leisure, the beleaguered outdoor retailer, is to collapse into administration, becoming the High Street's latest casualty and putting 3500 jobs at risk.

The operator of 208 Millets and 98 Blacks stores is to appoint accountancy firm KPMG as administrators, but suitors are likely to snap up the brands and assets of the group as soon as Monday.

Newcastle United owner Mike Ashley's Sports Direct, JD Sports Fashion and entrepreneur Peter Jones of the BBC programme Dragons' Den are among the four bidders interested in acquiring large chunks of Blacks Leisure in a pre-packaged administration.

This controversial insolvency procedure will allow a buyer to wipe out the group's debts and ditch unprofitable stores. Such a result will save many jobs at Blacks, but the new owner is expected to close its head office and warehouse in Northampton, which costs the company about £26 million a year, including rent and staff wages.

The sale of the group's assets and brands is also almost certain to see a number of its 306 shops closed. However, Blacks is not yet in administration and all its shops remain open for trade. The outdoor group confirmed that shareholders will be wiped out, and suspended trading in its shares at 1.38p.

The company said it "expected that the process to commence the appointment of administrators of the company and certain of its subsidiaries will begin shortly", which is likely to take place just before the completion of a sale. Blacks anticipates completing a sale of "substantially all of the trade, assets and brands of the group within the next few days".

Sports Direct has been tipped as a potential buyer of parts of the outdoor group for weeks, while JD Sports Fashion - whose biggest shareholder is Pentland, which owns the Berghaus outdoor brand - is another front runner.

The insolvency practitioners at KPMG will also be busy over the coming days handling the administrations of Past Times, the retailer of retro-themed gifts, and La Senza, the lingerie chain. All parties declined to comment.

Management at Past Times informed staff by conference call yesterday that 46 of its 100 shops will close before the end of Tuesday. It is believed that the Past Times' shops that make
less than £30,000 net profit a year will be shut.

The formal insolvencies of Past Times and La Senza are both expected before Tuesday evening.