In a statement, Coats said that following a strategic review of its businesses, it will focus resources on its global thread business and had appointed D&T the assist in the sale of the clothing arm.
Coats’ clothing business supplies Marks and Spencer almost exclusively and Coats confirmed that it was in discussions with M&S over the sale.
The Contract Clothing business currently employs 7,600 people, including 5,000 in the UK. Coats estimates the total cost of withdrawal from the business to be £150m, with the full provision being included in the full year accounts.
Chairman of Coats Viyella Sir Harry Djanogly said: ‘We determined to invest only in those business capable of delivering profitable growth and to sell or close the rest.’
Deloitte & Touche partner Maghsoud Einollahi, who earlier this year advised the Phoenix consortium in its successful bid for Rover Cars, added: ‘Our focus is to sell the businesses as going concerns and save thousands of jobs.
‘We have already identified a number of potential purchasers and are in discussions which may continue for a few weeks. We are consulting with Marks & Spencer to try to achieve the best outcome possible.’
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