Tue, 14 Jan 2020 | ADMINISTRATION
Department store chain Beales is in talks with two potential buyers as it looks to avoid entering administration.
Beales CEO and owner Anthony Brown confirmed that the company was in talks with a venture capital firm and a rival retailer over a potential sale. The company hopes to either confirm a sale this week or explore other options, once of which could be administration. It is also in rent reduction talks with landlords.
The retailer last month appointed KPMG to conduct a strategic review of the business and to explore financing options. Last week, it filed notice of intent to appoint administrators, providing it with 10 days’ protections from its creditors.
Beales is one of the UK’s oldest department store chains, having begun trading in 1881. It employs over 1,000 staff and operates from 22 stores across the UK.
Brown acquired Beales in an MBO in October 2018. For the year ending March 2019, the retailer saw its pre-tax losses more than double to £3.2 million, from £1.5 million the year before. Its sales saw a slight decline from £48.7 million to £48.3 million, leaving it with net debts totalling £15.8 million.
Brown said that Beales had suffered from difficult trading conditions and the “lunacy” of high business rates, but added: “We are confident that we have a solution for the business that will create a stronger if leaner Beales.”
“We hope to have a stronger business at the end of the process. I can’t predict which stores will stay and which stores won’t because it all depends on landlords and local government.”
“We’re going through a process and we hope to be able to restructure the business for a profitable future.”
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