Close to 1,000 jobs are at risk at 116-year-old tailoring brand Austin Reed, where administrators could be called in as early as next week.
The retailer, founded in 1900 by Austin Leonard Reed and famous for its suits, has filed a notice of intention to appoint administrators. This gives the company, which also owns the Viyella and CC (previously Country Casuals) fashion brands, protection from creditors for 10 days before it potentially tips into administration.
Last week American hedge fund Alteri Investors, which is backed by Apollo Global Management, took control of the retailer, which counts the International Monetary Fund chief, Christine Lagarde, among its customers. The retailer is understood to have lined up insolvency experts AlixPartners to handle the process.
The brand, whose customers included Winston Churchill and Elizabeth Taylor in its glory days, has struggled in recent years and in 2015 used a company voluntary agreement to close 31 unprofitable stores. It also moved out of its vast London flagship store at 113 Regent street in 2011, exchanging it for smaller premises over the road, but it is now trying to sell that store as well.
Alteri recently bought Austin Reed’s debt and equity from Darius Capital, a group controlled by property tycoon Guy Naggar, who was previously involved in the now collapsed investment company Dawnay Day. The fund is expected to have to pump more money into the retailer, which has more than 160 shops and employs an estimated 1,000 people.
Earlier this week Alteri’s chief executive, Gavin George, said: “We decided to acquire the equity and shareholder loans to protect our position as secondary lenders to Austin Reed, behind Wells Fargo who remain senior lender.”
This article was written by Zoe Wood and Sarah Butler, for theguardian.com on Friday 22nd April 2016 20.07 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010