Retailer’s Future Shifts Online Amid Pandemic Challenges
- Cath Kidston’s UK stores closed due to COVID-19 impact
- Over 900 staff made redundant
- Administrators appointed to explore options for the future of the business
- Part of the business sold to parent company Baring Private Equity Asia (BPEA)
- Retail store division not included in acquisition
- Stores closed following government guidance on social distancing
- No solvent sale found for the whole business
- Cath Kidston to continue digitally under BPEA
The administrators of Cath Kidston have confirmed that all 60 stores in the UK have closed, resulting in 908 staff being made redundant. Richard Fleming and Mark Firmin from restructuring practice Alvarez and Marsal were appointed as joint administrators to Cath Kidston yesterday. Part of the business, including the brand, website, and e-commerce platform, was sold to the company’s parent firm Baring Private Equity Asia (BPEA) in a pre-pack administration deal. However, the retail store division was not included in the acquisition. The administrators said Cath Kidston’s UK stores have been closed ‘in line with the latest government guidance on social distancing to support the Covid-19 relief effort’. Advisors from Alvarez and Marsal were initially engaged by Cath Kidston to explore options for securing the business’ future. They received several expressions of interest, but no offers involved a solvent sale of the whole business. Fleming said: ‘Like every retailer, Cath Kidston has faced significant challenges in recent years, including high rents and changing consumer behaviors. These challenges have been exacerbated by the outbreak of COVID-19 which has impacted the business globally since the beginning of the year. Though we couldn’t find a solvent solution for the whole of the business, we are pleased that Cath Kidston, in some form, will be able to chart a new course in the future.’ A BPEA spokesperson said: ‘While we are disappointed that the Covid-19 crisis has resulted in the cessation of the retail store network and impacted many employees, we are pleased to have secured a future for a number of Cath Kidston staff and the Cath Kidston brand in the form of a viable digital business.’
Factuality Level: 10
Factuality Justification: The article provides accurate information about the closure of Cath Kidston stores, the appointment of administrators, the sale of part of the business to Baring Private Equity Asia, and their plans for a digital future. It also mentions the challenges faced by retailers in general and the impact of COVID-19 on the business.
Noise Level: 3
Noise Justification: The article provides relevant information about the closure of Cath Kidston stores and the sale of part of the business to BPEA. It also mentions the impact of COVID-19 on the retail industry and the intention to continue the brand digitally. However, it lacks in-depth analysis or exploration of long-term trends or consequences for those affected by the decision.
Financial Relevance: Yes
Financial Markets Impacted: Cath Kidston’s closure affects its employees, parent company Baring Private Equity Asia, and potentially related retail businesses.
Financial Rating Justification: The article discusses the closure of Cath Kidston stores and the sale of part of the business to its parent company, which has financial implications for both parties. It also mentions the impact on related retail businesses due to changing consumer behavior and the COVID-19 crisis.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: Minor
Extreme Rating Justification: No extreme event mentioned in the article
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