Matalan eyes up sale as British retailers continue to feel sting
Matalan’s founders are eyeing up a sale, as the fashion firm struggles to fight off inflationary pressure.
As first reported by the Sunday Times, the retailer’s chairman John Hargreaves is understood to be working with advisors at Lazard on a potential deal.
This deal could mean a suitor snapping up the whole of the Matalan business or bringing in an investor to pump in fresh equity.
The Liverpool-based retailer employs 11,000 people across 230 UK stores, and posted sales growth of 38 per cent to £1.03 billion last year.
Sky News reported last month that Hargreaves had proposed pumping tens of millions of pounds into the clothing firm as a leadership tussle takes hold of the firm.
It was reported that Hargreaves was hoping to retain outright control of the company, with City sources suggesting some pushback on this from senior creditors.
The company is approaching a January deadline for refinancing £350m in debt, with an additional £130m instrument is scheduled for repayment the year after.
The talk of a sale comes as more and more high-street names face tough times.
Following profit warnings and poor sales, the British lifestyle brand Joules said last week that it is continuing discussions with Next over a £15m rescue deal,
Boohoo also recently posted its first UK sales drop in the fast fashion retailer’s history, pointing to supply chain disruption and a struggle to be competitive with international players.
Rival Asos warned that it expects its profit to be hit this year with more shoppers returning clothes, against a backdrop of sky-high inflation.
Matalan declined to comment on reports.