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New owner Sports Direct has said it will have to close half the stores - but documents from administrators reveal it was head office costs that weighed business down

It has been revealed that nearly all of Evans Cycles’ 62 stores were trading profitably when the chain was sold to Sports Direct last month – despite the latter’s owner, Mike Ashley, at the time saying that around half the shops would need to be closed to save the business.

Sports Direct bought the business in a pre-pack administration deal for just £8 million, with the acquisition leaving the bicycle retailer’s 1,300 staff facing uncertainty over their future.

> Sports Direct buys Evans Cycles out of administration, will close half of its stores

Telegraph.co.uk reports says that an administrators’ proposals document prepared by PricewaterhouseCoopers said that “almost all the stores were profitable.”

However, the administrators said that Evans, founded in south London in 1921 and now based next to Gatwick Airport in Surrey, was “burdened” by fixed costs associated with its head office.

They added that debts totalled £85 million, mainly to secured creditors, with £28 million owed to the banks HSBC and AIB, and £33 million to private equity firms.

At the time Evans entered administration it was owned by ECI Partners, which had bought the business in 2015 from fellow private equity firm Active Capital.

The remaining £24 million is owed to unsecured creditors, including trade suppliers, who will receive just 2.5 pence in the pound.

All 62 Evans Cycles stores remain listed on the retailer’s website and we are not aware of any of its branches – around half of which are in its traditional heartland of London and the south-east – having  closed to date.

> Evans Cycles to begin accepting gift cards again from Friday

Born in Scotland, Simon moved to London aged seven and now lives in the Oxfordshire Cotswolds with his miniature schnauzer, Elodie. He fell in love with cycling one Saturday morning in 1994 while living in Italy when Milan-San Remo went past his front door. A daily cycle commuter in London back before riding to work started to boom, he's been news editor at road.cc since 2009. Handily for work, he speaks French and Italian. He doesn't get to ride his Colnago as often as he'd like, and freely admits he's much more adept at cooking than fettling with bikes.