Oasis and Warehouse Group in administration filing
High street fashion retail chains Oasis and Warehouse are filing for administration as talks about a possible sale have not resulted in a deal. The company, which is owned by failed Icelandic bank Kaupthing, is appointing Deloitte as its administrator.
It's believed the uncertainty caused by the coronavirus pandemic made a sale of the business as a going concern impossible to conclude.
The two chains have had a chequered history in the past decade, a history that has included revamps, attempted sales and turnaround plans. But the group had been looking to be getting back on track, albeit slowly.
The turnaround was a work in progress at the point that the coronavirus outbreak started to have a major impact and this led to urgent talks about selling the company, which employs around 2,300 people.
The two chains have more than 500 stores between them with a little over 100 being directly-operated and the rest being concessions, including some in Sainsbury’s supermarkets.
Deloitte had been running the sale process but, as frequently happens in such situations, it seems that potential buyers were unwilling to take on the business as a going concern when it could be had with fewer onerous obligations following an administration filing. Sale talks are expected to continue following the administration filing.
The administrators are also expected to furlough most of the employees.
Sofie Willmott, Lead Analyst at GlobalData, said: “The lack of distinct design handwriting at Oasis and Warehouse, coupled with fierce competition from online pureplays and Zara, alongside their exposure to the struggling department store channel, has left the brands in trouble. With clothing & footwear expected to be the worst hit UK retail sector this year with spend forecast to fall by over 20%, the Covid-19 pandemic is reportedly set to claim two more victims in Oasis and Warehouse this week.
“Despite Warehouse improving its fashion credentials over the last couple of years and Oasis bolstering its marketing campaigns using celebrities such as Frankie Bridge and Katie Piper, the brands have failed to stand up against stronger players that are more front-of-mind amongst their target customer base. As demand for clothing continues to be decimated by a lack of social occasions, we expect to see further high street casualties over the coming month.”
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