Zavvi protects cash from administrator

Zavvi has reportedly opened a separate bank account to deposit takings from shoppers who have bought store vouchers.

Zavvi believes that the funds will be protected from an administrator if it is forced to cease trading.

EUK, the distribution division of Woolworths, is believed to be owed about 100m by Zavvi.

The Telegraph reports that Sir Richard Branson’s company is the guarantor of the supply arrangement between EUK and Zavvi.

On Friday, the company dismissed reports that it was in danger of going into administration.

A Zavvi spokesperson told MCV:

"In the unlikey event of anything happening, we’ll continue to be all about considering our customers. [Zavvi owners] Simon [Douglas] and Steve’s [Peckham] reputation is very important to them, so there has been a trust fund setup to protect customers.

"All the income from vouchers has been set aside to guarantee that if anything was to happen to us, customers wouldn’t be out of pocket. We’re trading fine except on our website and stock isn’t a problem – we’ve even got Wii Fits in. Any action we’ve taken is customer-focused."

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