Menswear retailer Moss Bros hires KPMG for restructuring

UK menswear retailer Moss Bros is reportedly undergoing a restructuring process, as it struggles to recoup losses over 2020. Moss Bros has seen its sales majorly impacted by the coronavirus lockdown, as the UK continues to struggle to keep the spread of Covid-19 under wraps.

Established in 1851 by Moses Moss in London’s Covent Garden, Moss Bros has gone on to become one of the UK's top menswear shops. Specialising in dress wear for formal occasions, Moss Bros has over 150 shops throughout the country. While it boasts revenues of around £130 million, however, it has been impacted by the same pressures which have plagued the rest of the high street in recent years.

In early 2018, Moss Bros Group issued a profit warning following a disappointing sales period over Christmas, citing lower footfall then anticipated in December. Two years later, following a contested private equity backed sale, the firm faces a stringent restructuring programme to improve its performance, and make up for floundering sales figures before and during the Covid-19 lockdown. The pandemic seems to have exacerbated Moss Bros’ flagging performance, particularly due to the cancellation of Royal Ascot and the banning of large weddings – key sources of demand for the menswear company.

Brigadier Acquisition Company – owned by property investment houses Regiment and Marquis – had tried to retract its £22 million move for Moss Bros, which concluded just two weeks before non-essential shops were ordered to close. In April it was revealed that Brigadier was seeking a ruling from the Takeover Panel in order to invoke a condition that would allow it to lapse its offer, however the request was withdrawn.

Last month, Moss Bros saw its non-executive chairman Colin Porter step down, along with several other directors as it transitioned to a private company. As the acquiring parent company already had a board, the Moss Bros board is being dismantled. Now, as the firm’s new owners look to move forward plans to correct the brand’s course, Moss Bros has called in KPMG.

As reported by the Sunday Times, the Big Four firm’s involvement could pave the way for a company voluntary arrangement (CVA) to be struck. A CVA allows companies to settle debts by paying creditors over a fixed period, and it could see the closure of some of Moss Bros’ 125 UK stores and rent reductions on others. KPMG is yet to comment on the reported engagement.