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Viyella in Administration

Women's and men's brand folds.

LONDON — Another historic British label has fallen victim to the credit crunch: clothing manufacturer and retailer Viyella.

This story first appeared in the January 8, 2009 issue of WWD.  Subscribe Today.

The company, whose origins go back to 1784, said Wednesday that it had gone into administration, the U.K. equivalent of Chapter 11.

“Following an assessment of the current economic situation and the prospects for the future, the directors have reluctantly decided that they have no alternative but to place the business into administration,” the company said.

Viyella is owned by British firm Waterlinks Investments, whose principals are John Harris and Sue Watson. The firm is one of the country’s oldest clothing manufacturers, and its name comes from a branded blend of wool and cotton twill. The name was later given to a soft, dress-weight, flannel-like fabric made by the company.

Viyella operates 100 stores and concessions in the U.K. and employs around 450 staff. Andrew Turpin, a spokesman for insolvency firm Poppleton & Appleby, said interested buyers already had contacted him. He said that all stores would continue trading while a buyer is being sought.

Until 2003, Viyella was owned by what is now known as Coats plc, the world’s largest sewing thread producer. The then Coats Patons acquired what was Vantona Viyella in 1986 to create Coats Viyella, the U.K.’s — and one of the world’s — largest textile and apparel manufacturers. But British companies’ inability to compete with low-cost manufacturing companies saw a precipitous decline in the U.K. textile sector, and Coats dismantled its operations throughout the Nineties to focus on sewing thread. Viyella was later sold to venture capitalists Harris and Watson, who added home furnishings to the clothing ranges.

In recent weeks, companies such as Waterford Wedgwood, Woolworths, Hardy Amies, Ghost, Allegra Hicks, Marchpole, tea merchant Whittards of Chelsea and china suppliers Royal Worcester and Spode all have gone into receivership. Woolworths has closed all its stores, having failed to find a buyer, while the other firms have found or are in the process of seeking buyers.

“It’s absolutely the ailing companies going into administration,” said Edward Whitefield, chairman of MHE, a London-based retail consultancy. “Administration does not respect the age profile of customers. It serves mediocre or badly performing companies, with not enough customers spending enough money to cover their costs,” he added.