Cath Kidston owner to buy online business through insolvency
Cath Kidston's owner is to buy the online, franchise and wholesale business of the brand, leaving its high street retail store facing uncertainty.
The company operates 60 UK stores which are at risk of being shut down permanently, resulting in potentially over 700 job losses, if the retailer accepts a pre-pack administration deal.
According to Sky News, Cath Kidston's parent company Baring Private Equity Asia is to buy "the brand, commerce platform and wholesale business" from administrators.
The deal will mean Cath Kidston effectively becomes a digital-only retailer, with shops such as its London Piccadilly flagship being permanently closed.
Earlier this month, Cath Kidston filed notice of its intention to appoint Alvarez & Marsal as administrators as the stresses of the coronavirus shut-downs started to bite on the high street.
Cath Kidston was established by the entrepreneur of the same name in 1993 and sold a majority stake to TA Associates in 2010. The business is currently led by Melinda Paraie, who was drafted in from Coach in 2018 to execute a turnaround.
The business has struggled in recent years with its latest available accounts showing an operating loss of £19.6m on sales of £130.7m in the year to the end of March 2018. UK sales accounted for £91.3m.
Cath Kidston Chief Executive Melinda Paraie’s previously announced a turnaround strategy for the retailer, which included cutting operating costs through a 40% reduction of head office staff and closing underperforming shops.