Woollen Mill joins hunt in the Blacks Leisure carve-up

The Scottish clothing group Edinburgh Woollen Mill will today submit a bid to acquire parts of Blacks Leisure, the beleaguered outdoor retail specialist.

Others retailers, including Mountain Warehouse and Go Outdoors, will also place first-round offers for chunks of Blacks Leisure, the operator of 98 Blacks stores and 208 Millets outlets.

Sports Direct, the biggest shareholder in Blacks with 22.5%, also remains interested in the outdoor group, which owns the Peter Storm and Eurohike brands, possibly through a debt deal.

However, Blacks Leisure, which has debts of £36 million, will almost certainly have to be rescued through a pre-packaged administration, which would see the group's debts and unprofitable stores ditched.

The potential trade buyers are likely to close Blacks Leisure's head office and warehouse in Northampton, which costs the company around £26 million a year, including rent and staff wages.

The accountancy firm KPMG is running the sale of Blacks Leisure and is also expected to do the administration. The outdoor retail group, which made a half-year loss of £16 million, wants to complete a sale in early January. All parties declined to comment.

Edinburgh Woollen Mill, which is best known for selling fleeces and cashmere jumpers to the over-45s, has a track record of buying ailing retail chains. The group, which has 254 of The Edinburgh Woollen Mill shops and 100 Ponden Home outlets, acquired the fashion chain Jane Norman out of administration in June. It has also previously bought from administrators the stores and assets of the soft furnishing chains, Ponden Mill and Rosebys. Philip Day, chief executive of EWM, carried out a £67.5 million management buyout of the group in 2002. Day's personal fortune is estimated at £300 million: a £250 million valuation of EWM and his other assets of £50 million.