Questions raised over Comet collapse

Comet stores around the country are trading for the final time Credit: ITV

Comet's remaining stores are trading for the final time today around the country, including at its North Shields branch.

It has since emerged that events surrounding the chain's collapse are to be examined by the company investigations branch of the Insolvency Service which will look at the run-up to the administration announcement and Comet's takeover by a private equity-backed investment vehicle in February.

Deloitte, appointed to run the electricals retailer in November, will close the final 49 stores, having failed to find a buyer for any of the 235-strong estate. The collapse has led to the loss of nearly 7000 jobs nationwide.

With insufficient funds raised from the winding down of the chain, it emerged that the Government will have to pick up the tab for £23.2 million of outstanding redundancy pay, accrued holiday pay and pay in lieu of notice.

A further £26.2 million will be lost in unpaid tax to HM Revenue & Customs.

Deloitte's report states the chain racked up losses of £95 million in the year to April, having seen revenues slump by £200 million on a year earlier, followed by a £31 million loss in the next five months as credit insurers lost confidence and withdrew support for the business.

Comet was hit by weak high street trading conditions, competition from online rivals and being unable to secure the trade credit insurance needed to safeguard suppliers.

In particular, it was knocked by the lack of first-time homebuyers who were key customers for Comet.