Tesco has agreed to buy Paperchase after the stationery brand fell into administration - but all its branches are facing closure after the shops were not included in the deal.
The supermarket announced a deal on Tuesday, January 31, to buy the Paperchase brand and intellectual property but not its physical stores or staff members, all of whom are likely to face redundancy. Paperchase has 106 branches across the UK, including in Newcastle's Eldon Square and Gateshead's Metrocentre, all of which are expected to shut after the deal was agreed.
The struggling high street store called in the administrators after failing to secure a buyer when placed on the market by owner Steve Curtis. Following the Tesco announcement, Paperchase told shoppers that it will continue to honour any gift cards in the short-term, but warned that redeeming them would 'not be possible' after two weeks.
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The administrators said: "On January 31, Mark Fry, Kirstie Provan and Gary Shankland, of Begbies Traynor, were appointed as joint administrators of Aspen Phoenix Newco Limited, which trades as Paperchase. Unfortunately, despite a comprehensive sales process, no viable offers were received for the company, or its business and assets, on a going concern basis.
"However, there has been significant interest in the Paperchase brand and attendant intellectual property. The joint administrators will continue trading the company’s operations in the short-term, with all stores remaining open and trading as normal."
The Paperchase brand is instead expected to be available within Tesco's branches. Jan Marchant, managing director of home and clothing at Tesco, said: "Paperchase is a well-loved brand by so many and we’re proud to bring it to Tesco stores across the UK.
"We have been building our plans to bring more brands and inspiration to the ranges we currently offer and this will help us to take those plans further. We look forward to sharing more with our customers in due course."
It comes after Tesco announced on Tuesday morning that it is making major changes at its stores which will affect more than 2,000 jobs. The supermarket said that it plans to shut its remaining counters and hot delis as well as close a number of in-store pharmacies as part of the shake-up.
The retailer is also set to change its management structure by reducing the number of lead and team managers in large shops, while the move will also introduce around 1,800 new shift leader positions. Tesco said that all affected workers will be offered alternative roles.
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