Shareholders narrowly vote through In The Style sale for £1.2m

In The Style has narrowly received approval from shareholders to sell its only operating subsidiary for £1.2 million in a deal that will lead to the fashion brand's delisting from AIM and avoid placing the business into administration.

Following a strategic review, the digital-led, influencer-driven fashion business will sell operating subsidiary In The Style Fashion Limited (ITSFL) to investor Baaj Capital for just £1.2 million. Shareholders voted 58.92% to 41.08% to approve the sale. It is expected that completion of the sale will occur on 27 March 2023.

The offer by Baaj, which was revealed earlier this month, included a pre-condition that In The Style founder and CEO Adam Frisby agrees to take an equity position in ITS Holdings 2023 Limited ('Bidco') – a newly established company formed for the purposes of the sale – equivalent to his current holding in the company.

Upon completion of the sales of the trading business, the AIM-listed In The Style entity will change its name to Itsum plc to avoid confusion with the In The Style brand. Itsum will become a cash shell and will cease to own, control or conduct all of the company's existing trading business.

In a statement today, In The Style said: "The company intends, as soon as practicable, to implement a members voluntary liquidation of the company in order to distribute the net proceeds of the sale received by it."

Proceeds from the sale will amount to £500,000 which will be distributed to current shareholders valuing their shares at 0.0025p each. Shares are currently trading at 0.53p.

Lincoln International led the strategic review and In The Style chairman Jim Sharp said it had considered a number of other options with "numerous parties" but concluded that "it is in the best interests of the Company, its Shareholders and its stakeholders to sell In The Style Fashion Limited to Bidco.

"The Independent Directors therefore believe that under the new ownership structure – with Adam’s continued leadership and Baaj’s backing – the In The Style brand can continue to build on its potential whilst protecting the interests of the Group’s employees, suppliers and other stakeholders."

In The Style announced its strategic review in December and revealed in a trading update in January that performance had deteriorated. The board said it expected revenue for the full year to 31 March 2023 to be in the region of £46 million.

The business was floated on AIM in 2021 with a value of £105 million but its share price has been on a downward trajectory since March last year when shares were trading at around 90p.

No potential bidder that came forward during the strategic review had offered to purchase the entire company but Baaj, parent of menswear retailer Blue Inc among others, made its offer on the pre-condition that Frisby also invested and stayed with the business. Baaj, a family office, prefers to invest in businesses where it works with the current owners and management teams.