Thu, 20 Jul 2023 | BUSINESS SALE
Footwear retailer Hotter Shoes has been acquired out of administration by WoolOvers Group in a pre-pack deal valued at £6.7 million. Hotter Shoes, the main trading subsidiary of listed firm Unbound Group, fell into administration on July 18.
Last week, it was reported that Unbound was seeking to raise £2 millionto secure Hotter Shoes’ future, with the business facing administration after a £10 million investment fell through in May and a sale process conducted in June ended without the company securing a buyer.
Interpath Advisory were engaged to undertake a strategic review of the business, with options under consideration including an equity fundraise or a formal restructuring plan. Failing this, Unbound said the company would likely be placed into administration, which would have seen its shares suspended from trading on AIM.
Interpath’s Will Wright and Rick Harrison were appointed as joint administrators of Beaconsfield Footwear Limited (which trades as Hotter Shoes) on July 18, immediately concluding a sale of the business and certain of its assets to natural knitwear brand WoolOvers. It has been reported that the deal will enable Unbound to stay out of insolvency proceedings while the board considers options for the company’s future.
The deal sees privately owned WoolOvers acquire Hotter Shoes’ entire network of 17 stores and ten concessions in garden centres. It had originally sought to acquire the brand solvently in April, but was outbid by a rival offer that was ultimately withdrawn.
Administrators said: “Following an extensive exploration of options, it became clear that it would not be possible to conclude a transaction on a solvent basis.”
The administrators added that Hotter Shoes “has been adversely affected by difficult trading conditions in the retail environment, and despite taking steps to address costs across the business, creditor pressure continued to increase.”
In Beaconsfield Footwear Limited's most recent accounts, for the year ending January 30 2022, the company reported turnover of £51.8 million, up from £44.4 million a year earlier, and a pre-tax loss of £1.2 million, down from an £11.4 million loss in its previous accounts. At the time, the company's net liabilities amounted to £3.8 million.
Find out how rising insolvencies are impacting sectors including retail.
Read about the impact of recent reforms around pre-pack administrations.
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