Fragrance Shop picks up a bargain

SANJAY Vadera’s Fragrance Shop has picked up the stock of its collapsed rival Passion for Perfume at a knock down price.

According to the administrators’ report into the failure of Passion for Perfume the Fragrance Shop will pay just 10% of the book value of its rival’s stock.

The report said the stock had a book value of £255,394 but administrators at Deloitte only expect a return of £12,770 from a sale to the Fragrance Shop, the retail arm of Sanjay Vadera’s Manchester-based Per Scent perfume business.

Some of the stock, spread across the business’s 45 shops, was subject to retention of title claims and a stock take at shops in Blackpool and Wigan revealed the outlets had fewer goods than expected – 80% less in Blackpool and 42% in Wigan.

Passion for Perfume, was owned by James Ridell, Nigel Tobias and Brendan Flood, the owner of Burnley FC and founder of Manchester developer Modus Properties.

The business collapsed in December with the loss of 194 jobs and debts of £4.7m. Unsecured trade creditors, owed a total of £1.02m, may get a “small distribution” from the company’s assets according to administrators. The biggest creditor was Mr Flood’s Modus Ventures, owed £2.9m.

The directors had been unable to stem widening losses at Passion for Perfume in recent years – posting an operating loss of £1.4m in 2007 – and failed to attract a buyer.

The administrators said: “Following further challenging trading conditions and reduced consumer demand in 2008 the company directors sought a buyer for the business. A buyer for the business as a whole was not found.”

Deloitte’s fees totalled £88,000 and other advisors’ fees came to £40,000. Last month the business had assets worth nearly £200,000.