Store closures likely following Bonmarche takeover
PUBLISHED: 15:08 02 April 2019 | UPDATED: 15:08 02 April 2019
Store closures and job losses are expected after struggling retailer Bonmarche was taken over at a cut-price rate of just £5.7m.
The clothing chain has been a high street staple since 1982 and has 312 stores across the UK, including bases in Ipswich, Bury St Edmunds, Felixstowe and Lowestoft.
On Tuesday, April 2, billionaire Philip Day, who owns The Edinburgh Wooleen Mill Group, acquired more than half the company’s shares – triggering a mandatory takeover bid.
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Acting through holding company Spectre, the businessman bought more than 26 million shares, representing 52.4% of the company.
Last month the womenswear retailer issued its third profit warning in just six months.
The retailer said it has seen “significantly weaker” trading since the start of the month, reversing a bounce-back in January and February after it resorted to heavy discounting to shift stock.
In a statement relating to the takeover offer, Spectre said: “Against the backdrop of the significant decline in Bonmarche’s profitability, Spectre believes it is well positioned to provide advice, guidance and support to secure the long term future of the Bonmarche business, its stores and employees.
“The owner of Spectre, Philip Day, has a successful track record within the retail sector, especially in turnaround and distressed situations.”
Mr Day has been linked with several retail turnarounds in recent weeks.
At the weekend he was named as a bidder in the race for collapsed womenswear brand LK Bennett, though he later withdrew from the process.
His other investments include Peacocks, Proquip, Austin Reed, Country Casuals, Jaeger and Jacques Vert.
Brian Tora of JM Finn and Co stockbrokers believes the takeover could be bad news for customers and staff.
Mr Tora said: “The pain being felt in Britain’s high streets continues with the Bonmarche chain.
“Philip Day has acquired more than 50% of the shares and has mounted a full bid, though at a disappointingly low price.
“Once he gains full control, store closures and redundancies look likely.”
However Maureen Hinton, a global retail research director at Global Date, feels the move could signal a change of fortunes for the brand.
She said: “Being taken out of constant City reporting and scrutiny will allow the retailer to take a long-term view of the business and benefit from the shared assets of the Edinburgh Woollen Mill group.”