Superdry has been in discussions with an existing lender about a multi-million pound loan, as the fashion retailer struggles for a turnaround.
The London-listed company said that it is in talks with Hilco, a turnaround specialist, about borrowing up to £20million as it attempts to return to more stable ground.
It stated that it would increase its existing loan facility with Hilco to about £10m, which will provide “necessary extra liquidity headroom” to facilitate its turnaround plan and its cost reduction program. A further £10m is also planned to “assist in seasonal working capital peak to the extent needed”.
These loans will be added to an emergency loan facility of £25million from Hilco, with an interest rate of 10.5% plus the Bank of England Base rate, as well as an agreement for an £80million facility with Bantry Bay Capital.
Sky News reported that Superdry had confirmed that the talks are at an advanced stage, but it is not certain they will result in a deal.
Julian Dunkerton is in talks with Davidson Kempner, a New York-based investment company that has backed several other British retailers, including JoJo Maman Bebe, Oak Furnitureland and New Look. He is currently in discussions with Davidson Kempner. This New York-based company has backed other British retailers such as JoJo Maman Bebe and Oak Furnitureland. He’s also in discussions with Gordon Brothers about a possible Superdry rescue. The retailer has seen sales slow down and issued several profit warnings.
Dunkerton who owns a 26% stake in the failing company was supposed to make an offer by March 1 or withdraw from the race. However, the deadline has now been extended until the 29th of March.
Superdry works with Teneo’s restructuring experts to explore other options for its business. This could include a possible company voluntary arrangement.
In January, the company hired PwC to look at debt-raising alternatives. Interpath Advisory was then commissioned to create cost-cutting strategies for the business in March.
Julian Dunkerton has attempted to revitalize the Superdry Brand by forming partnerships such as Brooklyn Beckham.
Julian Dunkerton (left) has been trying to revitalize the Superdry Brand by forming partnerships such as Brooklyn Beckham.
Superdry operates over 200 stores in more than 20 countries. Superdry has also 369 licensees and franchisees. Last year, the retailer said that it was “materially uncertain” whether or not they would be able to survive after a loss of £148.1million.
Dunkerton, who returned to Superdry after it was targeted by activists investors five years ago, has since tried to revitalize the brand with partnerships that include Neymar the Brazilian footballer and Brooklyn Beckham the son of David Beckham the former England captain.
The business has struggled to recover its footing following the pandemic, and is dealing with poor performances in its wholesale division. The suspension of its shares was due to a delay in publishing the full-year results.
Dunkerton, when the company released its results in September last year, said that it had been “a tough year” for the brand. He said: “It’s been an extremely difficult year for us. We had to manage our cash flow, catch up with our rents and stabilise our turnover. It hasn’t always been easy.