Authorization

French Connection gains lifeline from Toast sale

Struggling fashion brand French Connection is hoping a windfall from the sale of its stake in retail brand Toast will buy it some breathing space as it fights to turn around its fortunes. 
French Connection, which owns a 75pc stake in Toast, and minority owners Jamie and Jessica Seaton, sold the business to Danish fashion house Bestseller for ?23.3m. French Connection will receive ?13.9m in net cash from the sale.
Shares in French Connection jumped 19pc on the news and were up 14.42pc in lunchtime trading at 49.2p, as investors registered relief at the short-term boost to its finances.
If the sale of Toast, known for its womenswear and homeware, goes through successfully, French Connection wants to restart dividend payments once the company returns to profitability.
Last month French Connection reported its sixth annual loss as it continues to battle stiff competition from other brands on the high street and online. The clothes seller closed 11 stores in the year to January and posted an underlying operating loss of ?2.1m.
The retailer revealed at the time that it had received an unsolicited takeover approach from a US company but after discussions and due diligence checks, the suitor decided against making a formal offer.
French Connection gains lifeline from Toast sale

Last month French Connection reported its sixth annual loss, as it suffered from the weak UK retail environment
Chief executive Stephen Marks said: “French Connection will use the transaction proceeds to underpin its core business, allowing us to focus on our priority of returning to sustainable profitability and growth.”
Retailers have been contending with a decline in consumer spending along with higher costs because of the weak sterling and increases to the minimum wage.
Last month fashion retailer New Look was forced to close 60 stores as part of an insolvency deal with its lenders, while Toys R Us and electronics seller Maplin fell into administration in February. Carpetright and Mothercare are among other high street retailers considering closing stores, with the mother and baby retailer continuing rescue talks with creditors to refinance its debt after last week ditching boss Mark Newton-Jones.
All the major high street brands that have collapsed since the recession
Last year it emerged that Sports Direct, the acquisitive sportswear giant led by controversial tycoon Mike Ashley, had built up a 27pc stake in French Connection, just shy of the 30pc threshold that would force it to make a bid for the entire business.
See also:
Leave a comment
News
  • Latest
  • Read
  • Commented
Calendar Content
«    Декабрь 2018    »
ПнВтСрЧтПтСбВс
 12
3456789
10111213141516
17181920212223
24252627282930
31