Mega fashion retailer MS Mode files for bankruptcy
The administrators working on fashion retailer MS Mode's finances are filing for bankruptcy for the company. The current situation is no longer tenable, the administrators said to NU.nl. Dismissal will be requested for the 660 employees working at the 130 MS Mode branches in the Netherlands.
According to administrator Frits Kemp, the chain's debt is only increasing because MS Mode is spending money to keep the stores open, but Rabobank cashes the turnover based on an agreement made before the chain was granted suspension of payment. Kemp stressed that they've been negotiating with the bank all week, but so far to no avail. "Rabobank offers a pittance of what is normal. Something that is totally unacceptable."
The chain yields an average of 240 thousand euros a day. On that they have to pay 40 thousand euros in VAT and pay all kinds of costs to keep sales going, but for which the chain sees no compensation, according to Kemp. This means that the chain is making more and more debt - an untenable situation.
According to Kemp, the administrators are seriously considering closing the stores if an agreement isn't reached quickly. This could happen as soon as Thursday afternoon, but closing the doors reduces the chances of a restart. "That is the dilemma we face."
The court in Amsterdam granted MS Mode suspension of payment on August 5th. This only applies to the holding- and operating company in the Netherlands. The company also has branches in Luxembourg, Germany, France, Belgium and Spain. The chain's collection is made in the Netherlands and headquarters in Diemen.