Liquidators arrive as boo.com collapses

Boo.com, the online urban sports retailer, has collapsed after failing to raise the millions of pounds needed to put a radical restructure plan into action.

Having launched five months late last November, Boo.com lasted only six troubled-filled months before KPMG were called in on Wednesday to act as liquidators.

Around 300 staff will lose their jobs and they have been told they will each receive a severance payment of $1,188 (£800).

Boo.com has been one of the most high-profile European dot-com companies to launch so far. It was backed by $178 million (£120 million) in capital invested from a range of investors including LVMH chief Bernard Arnault, Benetton and Goldman Sachs.

In a statement, Ernst Malmsten and Kajsa Leander, joint founders and major shareholders of Boo.com said, "We are deeply disappointed that it has been necessary to ask KPMG to become liquidators of the company. The senior management of Boo.com has made strenuous efforts over the last few weeks to raise the additional funds which would have allowed the company to go forward with a clear plan."

They added: "This plan involved a restructuring of the retail operations, the development of an e-fulfillment business using our unique advanced technology and operations platform, and the identification of strategic partners. It is disappointing to both the management and staff alike that we were not able to bring this plan to fruition, particularly against the background of steadily improved trading."

The collapse is a huge a blow for the founders who touted the company as the first truly global e-commerce venture. However, the company has been weighed down by the costs of staffing, marketing and severe technical problems.

Many potential customers were never able to access Boo's web site because it initially required the most powerful and up-to-date home computers to use it.

Recently over 70 staff were laid off and a number of senior executives left the company. These included Luke Alvarez, vice president and chief development officer, who resigned last month to become chief operating officer of Emap Digital.

The departure of Alvarez came just a month after that of Dean Hawkins, finance director, who left for Chello Broadband, the Dutch internet company. He was preceded by one of Boo's founders, Patrik Hedelin, who left to spend more time with his family.

Last month, Boo reported underlying sales of $638,500 (£430,000) for its first quarter. However, trading has been much slower than many expected. Its much delayed launch left piles of unsold autumn/winter stock and was also hit by its failure to sign distribution agreements with Nike and Adidas.

It launched an immediate sale -- with offers of 40 percent off -- to clear the backlog, which was something it had said it would never do.





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Digital marketing executives oversee the online marketing strategy for their organisation. They plan and execute digital (including email) marketing campaigns and design, maintain and supply content for the organisation's website(s).