Toy chain falls into administration

Updated: 
SpitfireThe UK's largest specialist toy and model chain has collapsed into administration, affecting around 400 workers.

ModelZone, which has 47 stores across the UK, and its wholesaling arm Amerang have appointed Deloitte as administrator after the retailer lost out to online competitors and suffered hefty losses on onerous shop leases.


Deloitte said Modelzone gift vouchers would continue to be honoured but only towards 50% of the purchase price.

ModelZone, which has its headquarters in Lancing, West Sussex, is the latest retail casualty after furniture chain Dwell hit the wall last week after attempts to sell it failed, putting around 300 jobs at risk.
It is also understood that fashion retailer Ark, which has 17 stores primarily across the north of England, has lined up administrators, while 150-strong clothing chain Internacionale has filed a notice to appoint Ernst & Young.

Deloitte said it was seeking to "preserve jobs" at ModelZone and secure a sale of the business as a going concern.

ModelZone founder David Mordecai, who is chief executive of Hawkin's Bazaar parent Tobar Group, is reportedly preparing to launch a rescue bid for the chain. He launched the business in 1987 after he bought Brighton-based Model Aerodrome, rebranding it ModelZone as he expanded the chain.

Richard Hawes, joint administrator and partner in Deloitte's restructuring services practice, said: "ModelZone has historically been profitable, however in recent years the company entered into leases for new stores that proved to be loss making.

"This, coupled with the growth in online competition, has resulted in ModelZone generating losses over the last couple of years, which the board of directors has now concluded is unsustainable and sought the appointment of administrators."

Its wholesaling business, Amerang, is profitable, but sought the protection of administration following the collapse of its sister company ModelZone, according to Deloitte.

High Street casualties

High Street casualties

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