- Administration puts nearly 1,200 jobs on the line
- Austin Reed has already garnered around 20 expressions of interest
- No imminent store closures or job losses
Austin Reed has collapsed into administration and there are already a number of interested parties waiting in the wings, Retail Week understands.
Interest in Austin Reed has been “considerable”, sources told Retail Week, due to its iconic status. There have been as many as 20 expressions of interest in all or parts of the business from a range of parties that span trade buyers and private equity firms, it is thought.
There are no immediate plans for Austin Reed store closures or redundancies, Retail Week understands, although the administration does put the long-term future of around 1,184 jobs on the line.
The struggling fashion retailer appointed Alix Partners to handle the administration, after filing an intention to appoint administrators last week, as revealed by Retail Week on Friday.
Alix Parters said the administration is a result of ”cash flow difficulties arising from challenging retail market conditions”. Founded in 1900, Austin Reed has 100 standalone stores and 50 concessions in the UK and Ireland.
Austin Reed was already working with the turnaround consultancy firm, after appointing it to assess its financial position and options less than two weeks ago.
Alix Partners joint administrator Peter Saville said: “Our priority now is to work with all stakeholders and determine the optimum route forward for the business as we continue to serve customers throughout the UK and Ireland.
“Austin Reed is a well-regarded and iconic brand, and therefore we are confident that it is an attractive proposition for a range of potential buyers. As such, we expect – and welcome – contact from interested third parties.”
Jaeger owner Better Capital has been rumoured as a possible suitor for the business.
Alteri Investors acquired a large stake in Austin Reed, consisting of the retailer’s loan notes and shareholder capital, from Darius Capital just days ago.
The business is now part-owned by secondary lender Alteri and primary lender Wells Fargo Capital.
Austin Reed is the most recent in a line of beleaguered UK retailers that Alteri has invested in.
Alteri Investors chief executive Gavin George said last week: “We decided to acquire the equity and shareholder loans to protect our position as secondary lenders to Austin Reed, behind Wells Fargo, who remains senior lender.”
GCW has been appointed to advise on the property portfolio.