British fast-fashion retailer New Look to sell French subsidiary
A new chapter is unfolding in the saga of New Look’s French subsidiary. In 2018, its senior management announced a spate of closures, with job protection measures affecting 262 employees. It then changed its mind, and is now actively looking for buyers.
“The New Look group, itself faced with serious financial difficulties, which led it implement a substantial restructuring as previously announced, can no longer absorb the losses of New Look France,” the group stated in a press release.
Last November, Paul-Henri Cécillon, CEO of corporate turnaround specialist Phinancia, was put in charge of New Look France to assess the state of the company and its business. Rather than implement a job protection plan, the decision finally taken has been to sell the company. In January, New Look instead decided to let its Belgian subsidiary go bankrupt.
The fast-fashion retailer owned by the Brait investment fund is present in France since 2006, operating 32 monobrand stores with just under 500 employees. “In the last three years, New Look France’s results significantly worsened due to the crisis of the French textile and apparel market, made more serious in the last few months by the forced closure of several stores during the ‘yellow vest’ demonstrations on various week-ends in December 2018 and January 2019,” stated the group. In 2017-18, New Look’s sales in France fell by 13.6%, down to €57.9 million, compared to €67.05 million recorded the previous financial year.
In the first nine months of the 2018-19 financial year, the budget fashion chain, which operates nearly 600 stores worldwide, lost 5% in global sales, which fell to GBP1.016 billion (€1.16 billion). In mid-January, the group reached an agreement for the refinancing of its debt and, according to British media, the option of selling the parent company has also been considered.
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