Superdry is set to leave the London Stock Exchange and seek rent reductions as part of a big to raise £10m to prevent going bust.
The troubled fashion retailer has 94 UK locations - including a unit in Union Square - and expects restructuring to result in rent reductions across 39 of its stores.
But the process is conditional on the business receiving proceeds of the equity fundraising, which chief executive and co-founder Julian Dunkerton will support.
The brand was valued at £1.7bn in 2017 but closed on Tuesday with a market capitalisation of just £7.9m, shares down 2p (23.8%) to 6p.
"The reality is we're losing money," Dunkerton said.
He added: "We have to make sure that we’re right-sizing this business, cutting our fixed costs, making sure that we are here for the next ten or twenty years, [that] we save jobs and we have a positive outlook on the future."
Dunkerton admitted that there would be "a few closures" if rent agreements are not reached.
Michael Lynch, partner at
law firm DMH Stallard and specialist in business restructuring and insolvency, said: "Where a retailer is
suffering from diminished trading and share value, restructuring agility is
crucial; the earlier, the better.
"In this case,
Superdry’s delisting appears to be an attempt to harness more investment
options, for example by the provision of a stake in the business to investors
and more restructuring options.
"It’s likely that
various lenders and investors with long-term strategies in mind, will look to
Superdry to cut costs by way of some informal insolvency strategy, such as a
restructuring plan; it appears likely that the overarching costs pressures will
result in closures and redundancies, as has been seen with other large
mid-market brands in the retail sector, within that plan."
Superdry hopes to de-list by July, subject to shareholder approval.
FTSE 100
The UK's flagship share index, the FTSE 100, was down nine-points at 7,810 shortly after opening this morning.
Brent crude oil futures were down 0.53%, trading at $89.54 a barrel.
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