Coronavirus disruption pushes Mothercare Ireland into liquidation

DUBLIN (Reuters) - Mothercare's MTC.L Irish franchise owner placed its 14 baby products stores into liquidation on Friday, becoming one of the first major retail outlets in Ireland to blame the coronavirus lockdown for its demise.

Mothercare Plc still operates around 1,000 overseas franchise stores following the collapse of its UK business, where it fell victim to stiff competition from online retailers and rising costs across the retail industry.

Major UK retailers have a big presence on the high street in neighbouring Ireland, where an economy that has been the fastest growing in Europe for much of the last five years has shielded it from some of the extremely difficult conditions in Britain.

Mothercare Ireland, which employed 197 people, had already experienced issues with its supply chain before suffering an unprecedented hit from late-March with the lockdown of the Irish economy, Managing Director Jonathan Ward said in a statement.

“What has become clear over the recent weeks is that store sales are going to continue to be seriously impacted in the short term whilst social distancing measures are in place and longer term as consumer habits permanently change,” Ward said.

The liquidation followed the closure by British department store group Debenhams of its 11 Irish stores in April, costing between 1,200 and 2,000 jobs.

The coronavirus-related disruption has already left 26% of Ireland’s labour force either temporarily or permanently out of work compared with an unemployment rate of 4.8% in February, when almost anyone who wanted a job could get one.

The government is reopening the economy at a more cautious pace than most of Europe with non-essential retailers allowed open their doors again this week and shopping malls due to resume trading next week.

Reporting by Padraic Halpin;Editing by Elaine Hardcastle