The Sydney Morning Herald reports that the administrators of collapsed swimwear brand Seafolly will shut all of the company’s Sunburn-branded stores in an effort to slim the business down for a potential sale.
According to the report, KordaMentha administrators Scott Langdon and Rahul Goyal said as many as 50 local and international buyers had expressed interest in the brand following its collapse earlier this week, with initial bids due by Sunday, July 12.
As a result, all 15 stores under the Sunburn banner will be shut over the next two weeks, a move intended to make the troubled business “more attractive” to buyers, SMH says.
“The slimming down of the cost structure and closure of unprofitable stores will make the Seafolly business much more attractive to buyers,” the report quotes administrator Scott Langdon as saying. “Seafolly has a clearly defined and strong brand globally and is a market leader in its niche, while Sunburn struggled to reach the same heights.”
The Sunburn stores set to be closed are in Erina, Werribee, Cronulla, Springfield, Big Swim (Bondi), Marina Mirage, Shell Harbour, Mosman, Pacific Fair, Chermside, Joondalup, Macquarie, Manly and Top Ryde, SMH discloses.
Seafolly fell into administration on June 29, with the owners citing “the crippling financial impact of the COVID-19 pandemic” as a reason for its collapse. The company employs 121 staff and operates 56 stores both locally and internationally.
SMH says the remaining 25 Australian Seafolly stores are continuing to trade as normal throughout the sale process, with “deep discounts” on offer. Sales will also be on at Sunburn in an effort to clear stock prior to their closure.
Information memorandums will be issued to prospective buyers, and the administrators are hoping to have a sale proposal ready by the second meeting of company creditors in early August, the report states.
Seafolly is owned by private equity firm L Catteron, an offshoot of consumer goods giant Louis Vuitton Moet Hennessy (LVMH), which also owns popular boot brand RM Williams. L Catterton purchased 70 per cent of Seafolly for about AUD70 million in 2014 from the founding Halas family.
Scott Langdon and Rahul Goyal of KordaMentha Restructuring were appointed Voluntary Administrators of the Australian swimwear and women’s beachwear fashion brand, Seafolly on June 29, 2020. The appointment includes the entities relating to the Sunburn business.