Fri, 12 Apr 2024 | BUSINESS SALE
The European arm of Japanese retailer Muji has been acquired by an existing shareholder in a pre-pack deal. Muji Europe Holdings Limited fell into administration earlier this month, appointing administrators from EY as part of a “planned restructuring of the business”.
The business, which has six stores in London and one in Birmingham, has seen surging popularity over recent years, driven by its simple household products inspired by Japanese design. However, the company fell to an operating loss of close to £16.3 million in the year to August 31 2021, on turnover of £75.8 million, with net liabilities of more than £15.5 million.
The company, like many other high street businesses, had been severely impacted by COVID-19's effect on retailers and it had insufficient liquidity to repay overdue loans that it had taken on during the pandemic, leading to the appointment of administrators.
EY has now secured a pre-pack deal to sell the European operations to shareholder Ryohin Keikaku Co, through Muji Europe. The deal secures a total of 733 jobs across the division’s offices and 32 retail and e-commerce stores across Europe, which remained open as usual during the administration.
Speaking to TheBusinessDesk.com, a company spokesperson said that, following the restructuring, the business will receive considerable investment from its main shareholder, with plans for new stores and an improved e-commerce offering across Europe.
In addition to the seven UK stores, the European business operates stores in France, Italy, Spain, Germany, Denmark, Portugal, Switzerland and Finland, along with franchise stores in Poland and Ireland. The retailer’s global operations, which span 19 countries in Asia Pacific and North America, were unaffected by the administration of the European arm.
Simon Edel, joint administrator at EY, commented: “The sale of the Company secures the future of Muji’s European business, safeguarding over 700 jobs and 32 retail and ecommerce stores across the UK and Europe. Stores remain open and continue to trade.”
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