Phase Eight changes hands in management buyout

Clothing retailer Phase Eight is poised to change hands in a management buyout, which will be supported by Russian investors.

The womenswear retailer's chairman, Michael Rahamin, is leading the MBO; he has been an investor since 2007, when the private equity division of Icelandic bank Kaupthing purchased the chain for £51.5 million from Barclays Private Equity.

Phase Eight has 80 shops and 127 concessions in department stores including John Lewis and Debenhams. It is understood to be expanding into Switzerland, Scandinavia and Asia, and is setting up a buying office in China.

The firm posted a turnover figure of £59.2 million and profits of £4.4 million for the year to January 2009. Sales for the year to January 2010 are allegedly much higher, with particularly robust trading in the department stores.

Stakeholders are said to include Kaupthing Capital Partners with a 49 per cent holding, Jane Norman chief executive Saj Shah, Jane Norman deputy chief executive and finance director Ian Findley, as well as Kew Capital, who invest on behalf of Russian steel magnates Mr Abramov and Mr Frolov.

Phase Eight received numerous unsolicited approaches earlier on this year from private equity firms Lloyds Development Capital, Inflexion and Change Capital.

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