Sale of underwear firm saves 30 jobs

A PRE-packaged administration at an Oldham-based textiles firm which sold branded underwear has saved 30 jobs.

Power Play (Textiles), which produces underwear, socks and nightwear for brands such as Levi’s, Ben Sherman and Ecko, was placed into administration on February 13, with Phil Duffy and Steve Muncaster from the Manchester office of Duff & Phelps being appointed as joint administrators.

Mr Duffy said that the business, which operates from Grape Mill in Royton, had suffered from a slight decline in sales as a result of the impact that reduced consumer spending had on its high street customers.

However, greater damage had been caused by the fact that it had leased the entire mill from the landlord, and had sub-let the majority of the space to a group of other tenants.

In recent months, many of these had left the building either as a result lease expiry or because they had ceased to trade, which meant the company’s property costs rocketed from £150,000 to around £500,000 per year.

The company, which was owned by Mark and Danny Samuels and Sandy Casofsky, made a pre-tax profit of £188,000 on sales of £11.1m in the year to March 31. Mr Duffy said the underlying business was fundamentally sound but that a restructuring was necessary in order to secure its long term future.

“If they didn’t do it now, it may well have happened in 5-6 months.”

Mr Duffy said that trading the business whilst in administration or the sale of assets to a third party would have been complicated by licensing issues, since agreements with brand owners such as Levi’s specifically forbade the company from selling its brands while in administration.

A pre-packaged sale was therefore agreed with existing management.

It is understood that the company will continue to trade temporarily from Grape Mill until alternative premises are found.