The British arm of lingerie chain La Senza has called in administrators for the second time in two-and-a-half years in a move that could lead to hundreds of job losses.
The chain was a franchise so its failure means ownership of the brand reverts to American lingerie giant Limited Brands, which also owns Victoria's Secret. The situation means the retail chain is likely to be broken up with stores sold to rival retailers.
La Senza's parent company Marnixheath operated 55 La Senza stores and three Pinkberry outlets in the UK and has 752 employees. The company is thought to have been seeking a buyer for some months but said it had "decided with regret that there is no alternative to administration", with PwC appointed on Tuesday.
"Every effort has been made for two and a half years to transform and revitalise the La Senza UK business, but it has continued to experience difficult trading conditions, against the backdrop of a challenging economy and the changing dynamics of the UK retail market," said Marnixheath.
The company made a loss of £26.2m on sales of £43.3m in 2012 according to the most recent set of accounts filed at Companies House.
La Senza's UK business was formerly owned by Dragons' Den star Theo Paphitis. He sold the chain, known for its colourful lingerie, to private equity firm Lion Capital in 2006 for £100m and remained on the board until 2009. But the retailer struggled as the economy got into difficulties and it finally called in administrators in December 2011.
It was rescued from administration in 2012 by a division of Kuwaiti retail group Alshaya, which operates franchises for brands including Next and Mothercare as well as Limited Brands. It changed its name from Alshaya UK to Marnixheath in January of this year.
Paphitis said the failure of La Senza was "very sad" but, having started rival chain Boux Avenue in 2011, he was not interested in rescuing the troubled business. "I've got a new baby now so it is probably not for us," said Paphitis. The Boux Avenue and La Senza store estates overlap in more than 20 locations but the entrepreneur said he would look at stores in places where it was not represented.
Robert Moran, joint administrator at PwC, said: "Like many other retailers, La Senza has been hit hard by the difficult economic environment and a slowdown in consumer spending."
The North American and other international operations remain unaffected.
Moran said there were "no immediate plans" to close stores, and the administrators would be holding discussions with interested parties about the potential sale of the business. The 58 store estate includes outlets in Westfield Stratford and Bluewater shopping centre in Kent which are likely to be attractive to other retailers.
