RSM administrators complete sale of Bonmarché
In late 2020, fashion retailer Bonmarché fell into administration for the second time in 14 months, placing 1,500 jobs at risk. Now, joint administrators from RSM have announced that they have completed the company's sale to Purepay Retail, which is backed by an international investor consortium.
Bonmarché is a clothing retailer based in Wakefield, West Yorkshire. The business was founded in 1982, and quickly grew into a chain of over 200 stores, a huge headquarters at Grange Moor, with a turnover of more than £200 million.
However, as is an all-too-familiar recurring theme in the global retail scene, the once strong brand suffered a swift decline following its purchase by private equity partners (in January 2012 the business was purchased by private equity group Sun European Partners) keen to turn a rapid profit on their investment.
Despite a series of rescue bids, it was placed into administration in October 2019, with FRP Advisory overseeing that process. That particular administration only supplied the retailer with a temporary reprieve, and less than two years later, RSM Restructuring Advisory was installed as administrator to BM Retail – which operates the Bonmarché brand from 225 stores in the UK – at the end of November. While no redundancies or store closures were made immediately, administrators launched an urgent sales process for the business.
Joint administrators Damian Webb and Gordon Thomson have now announced the completion of the sale of the businesses to private equity-backed Purepay Retail. The deal brokered by RSM sees Purepay acquire all the remaining stock of the company, as well as the head office site and distribution centre in Wakefield, while securing around 531 of Bonmarché’s jobs. Purepay will operate 72 stores under licence, and 387 store staff will transfer to the acquirer, alongside all 51 head office and 93 distribution centre staff.
Commenting on the deal, RSM’s Webb stated, “The business has been widely marketed and the sale protects the core business. Against a challenging retail environment, we are now focused on protecting the remaining estate and the associated employees.”
The remaining 148 Bonmarché stores are currently closed in line with Government legislation and the administrators are reviewing all options for these sites prior to the lifting of the Government lockdown. The staff at these stores are currently on the state’s furlough scheme to preserve jobs during the Covid-19 pandemic.
