Just a year shy of celebrating its centenary, retailer Woolworths Group PLC was on the verge of collapse as financial administrators appointed to the company raced to find a buyer for its 800-strong chain of outmoded stores.

The potential demise of the purveyor of an eclectic range of goods from sweets and cheese graters to magnifying glasses and DVDs marks the biggest retail casualty of a severe slump in consumer spending and - along with the similar collapse of furniture chain MFI - puts almost 30,000 jobs at risk.

Looking for buyers

"The eye of the storm has moved on from the banks to the retailers," said Keith Bowman, an equity analyst at Hargreaves Lansdown Stockbrokers."

Woolworths, which opened its first store in Liverpool, northern England, in 1909, said it had appointed Deloitte to take control of Woolworths PLC, its retail arm comprising its stores and distribution centres that employ some 25,000 people.

Deloitte administrators are looking for buyers - either for the entire business or its parts - and are also now in charge of Entertainment UK Limited, its wholesale distributor of entertainment products after last-ditch attempts at a fire sale of both divisions failed.

MFI, which employs around 1,500 people in 100 stores across the country, appointed MCR as administrators, citing the downturn in the property market for killing demand for its "big ticket" goods.

Weak earnings

The scale of the spending slump on the retail sector was further highlighted by weak earnings reports on Thursday from home improvement retailer Kingfisher PLC and DSG International PLC, Britain's largest consumer electronics retailer.

John Gorle, national officer of the shopworkers' union Usdaw, said the union was seeking urgent talks with administrators to gain guarantees about workers' pay and jobs.

Dan Butters, reorganisation services partner at Deloitte, said the admini-strators had received "expressions of interest from a number of parties for both the retail and wholesale businesses" in the past 24 hours.

"We are working hard to ensure that any sale of the business, in whole or part, will preserve jobs," he said, adding that all stores would remain open for now.

Filing for protection

Placing a company into administration is similar to filing for bankruptcy protection. Administrators are appointed to salvage as much of the company as possible for the benefit of its creditors, a process which can involve trying to keep the business as a going concern or breaking it up and selling it off.

MCR joint administrator Philip Duffy was less positive about its task with MFI, saying that a decision had not yet been made "as to an appropriate exit route and the future of the company" and that sales of some or all stores were under review.

Woolworths' current debt-laden predicament is a far cry from the clamour that greeted the first British store when it opened under the FW Woolworths brand - a subsidiary of its US parent.

Lines formed for hours before the doors opened and eager customers all but stripped the counters bare before the end of the day - with everything from glassware to tin toys flying off the shelves.

At the height of the company's success, a new store was opening every 17 days.

But in recent years the company has struggled to remain relevant as super-market chains expanded aggressively into its traditional business, selling everything from bed linen to toys and underwear.

Shares suspended

Its shares were suspended from trading last Wednesday, November 26, at barely more than a penny each.

Two parts of the Woolworths group - its 2Entertain DVD publishing joint venture with BBC Worldwide and its Bertram book wholesale business - are not in administration.

The company said it was in ongoing discussions to sell its 40 per cent stake in 2Entertain to BBC Worldwide.

- AP