Tesco is poised to snap up the Paperchase brand in a surprise swoop that will cast a shadow over hundreds of high street jobs.
Sky News has learnt that Britain’s biggest supermarket chain is in advanced talks about buying Paperchase’s name and other intellectual property through a pre-pack administration that could take place as early as Tuesday.
Sources close to the situation said Tesco was unlikely to be interested in any of Paperchase’s stores, meaning that most of its workforce may face the prospect of losing their jobs.
It was unclear on Tuesday morning whether any other suitors were in talks about a deal.
Sky News revealed this week that the chain was on the brink of administration as hopes of a solvent rescue deal faded.
Begbies Traynor, the professional services firm, is lined up to handle the insolvency following a sale process run by PricewaterhouseCoopers over recent weeks.
Paperchase was put up for sale late last year, just four months after its most recent change of ownership.
The chain was taken over in August by Steve Curtis, an experienced retail investor who has been involved with Tie Rack and Jigsaw.
Retail Realisation, an industry advisory firm with which Mr Curtis and turnaround firm Rcapital are affiliated, was also involved in last summer’s deal.
Paperchase had previously been one of many retail casualties of COVID-19, having undergone a pre-pack administration in January 2021.
Other notable high street chains to collapse during the pandemic included Debenhams and the Dorothy Perkins-to-TopShop empire, Arcadia Group.
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It trades from about 100 stores, and Mr Curtis was said at the time of the most recent takeover to be backing an existing management plan to grow that number to approximately 150 in the coming years.
Permira Credit, the previous owner, had invested in Paperchase’s digital offering as well as new shop openings and executive recruitment since its last brush with insolvency.
At that time, Paperchase employed nearly 1,300 people, and traded from more than 125 sites across the UK.
Its outlets included concessions at House of Fraser, Selfridges and a number of Next stores.
Tesco and Paperchase both declined to comment.