The Irish division of DIY and garden centre chain B&Q has gone into examinership, it has confirmed.
B&Q, a wholly owned subsidiary of Kingfisher, the UK-based home improvement retailer, expects to keep its nine Irish stores open during the 100-day period.
Brian Mooney, company chairman Ireland, said the aim was to rescue a business hit by recession.
“The management team is hopeful that a sustainable business can emerge from the examinership process, based on a restructuring of the company. Our priority remains our employees and our customers,” he said.
“Our colleagues have been briefed on today’s development, and understand that the company’s objective in seeking the appointment of an examiner is to try to protect jobs and retain competition and consumer choice in the market.”
The company said all 690 employees will be paid, and all pre-paid goods and services, including kitchens, bathrooms and bedrooms and their installation, together with gift vouchers and credit notes will be honoured.
Suppliers will be paid for goods and services supplied during the process, the company said.
The company lodged an application at the High Court in Dublin seeking the examinership protection against its creditors for up to 100 days.
B&Q, which has been in Ireland since 2002, said it has proposed the closure of two outlets in Athlone and Waterford, and also suggested that another two close on economic grounds.
Declan McDonald of PWC has been appointed the interim examiner. He will have final say on which if any of the four stores close.
B&Q said that in order to have a reasonable prospect of survival landlords need to consider renegotiating lease arrangements while it will look at shutting uneconomic stores.
All orders and installations will be honoured.
David Fitzsimons, Retail Excellence Ireland chief executive, said high rents, including the upward only rent review policy, was to blame.
“We have clearly stated to successive Government that the continued existence of upward only rent reviews is causing significant damage to job numbers and the ability of retailers to remain trading,” he said.
“The majority of retail tenants now pay more on their rent than on their total labour force.
“For Government to claim they are serious about jobs and yet not implement the promised legislation to abolish upward only rent smacks of hypocrisy, especially considering the industry has already lost 60,000 jobs since 2007.
“For landlords to rigorously enforce Celtic tiger rents when consumer demand has collapsed is simply untenable – it proves that many Landlords are out of touch and contributing significantly to job losses. If Government do not legislate, 2013 will witness an unprecedented level of retail industry failure.”