Upmarket lingerie brand Agent Provocateur may be heading for administration to enable a pre-pack buyout of the business from its private equity majority stakeholder 3i.
Since late last year 3i has been seeking a buyer for the business, in which it acquired a controlling stake from co-founder Joe Corré 10 years ago for £60m, after accounting irregularities were discovered.
The private equity house was subsequently obliged to write down the value of the business by £39m and inject in a further £4m in cash. In early January it called in restructuring business Alix Partners to assess its options.
According to The Guardian, by late last week around five bidders had submitted offers for the business including Lion Capital (which formerly backed La Senza) and Alteri. 3i had been looking for bids in excess of £30m to cover the amount it owes its lenders.
However sources told the publication that placing the business into administration to allow for a so-called "pre-pack" buyout would enable someone to purchase it without some of its liabilities. The Agent Provocateur brand is still considered to be a strong one but industry watchers say it over-extended itself in recent years into stores and department stores.