Aquascutum to be put into administration *Update, may be saved*

[Chanelcouture09]

Aquascutum will be placed into administration as early as today, according to two people familiar with the company’s plans, putting about 250 jobs at risk and threatening the possible demise of a classic British clothing brand.
Harold Tillman, the fashion entrepreneur, has been battling to save the luxury raincoat maker he acquired in September 2009 . Mr Tillman bought the business from Renown, a Japanese trading house, in a deal that united it with Jaeger, another venerable fashion chain founded in 1884.
On Monday, Mr Tillman sold a 90 per cent stake in Jaeger – and all of its secured debt – to Jon Moulton’s Better Capital in an effort to protect it from any possible fallout from Aquascutum.
Mr Tillman has invested more than £20m in Aquascutum, according to people familiar with the situation, but could no longer afford to support the lossmaking retailer.
Mr Tillman, who is also chairman of the British Fashion Council, initially made progress at Aquascutum.
But as part of the original deal, he sold the lucrative rights to the Aquascutum brand in Asia to YGM Trading, a Hong Kong-based company. The business was also hit by the recent departure of Belinda Earl, Aquascutum and Jaeger’s respected chief executive, due to health issues.
Aquascutum was founded in 1851 by tailor John Emary. In its early days it was best known for developing a new style of trenchcoat during the first world war. Over the years it has dressed the Queen Mother, Winston Churchill and Lady Thatcher, as well as celebrities such as Humphrey Bogart and Cary Grant.
About 250 people work at Aquascutum, including its factory in Corby. Many of Aquascutum’s operations were combined with Jaeger’s.

*ft.com

 

[Chanelcouture09]

The Jaeger fashion brand has been sold in a rescue deal as the retail empire built by one of the UK's best known rag traders unravels in the high street downturn.

Harold Tillman, who is chairman of the British Fashion Council, sold the business to distressed debt expert Jon Moulton's Better Capital for just under £20m with "substantial majority" used to settle its debts. Moulton is best known for his failed attempt to rescue another historic British brand, MG Rover.

Tillman is also locked in talks about the future of one of his other investments, the loss-making Aquascutum clothing brand, which he has owned since 2009.

In its heyday, Jaeger dressed Audrey Hepburn and the Duchess of Windsor, but by the 1990s it was more country set than jet set. When Tillman acquired it for an undisclosed sum in 2003 it had been losing money for several years. He drafted in former Debenhams chief executive Belinda Earl to lead the turnaround and appeared to be making progress thanks to more fashionable products and new ranges such as the upmarket Jaeger London brand, which it shows on the catwalk. But the success proved to be short-lived; in its last set of published accounts, for the year to the end of February 2011, operating profits had more than halved to just £1.4m on sales of £94m. At that time the company warned "the impact from falling consumer confidence is proving challenging". People familiar with its more recent performance said the picture had deteriorated since then with the retailer likely to be loss-making this year.

Better Capital specialises in company turnarounds and last month bought double glazing firm Everest. With debt of £13.4m and climbing this time last year, its intervention enabled Jaeger's lender, Bank of Scotland, part of the state-backed Lloyds Banking Group, to be repaid and the company to survive. "The board is pleased that Jaeger has a new owner in Better Capital, thereby securing the future of the business," the retailer said in a statement. "The investment that Better Capital has provided will create a strong foundation."

Tillman's stake in Jaeger has been cut from 70% to 10% but he will stay on as chairman.

The deal was done swiftly with Moulton only starting to study the numbers "about a week ago" but he said: "The potential is obviously there. It's a fantastic brand name and has got some very good sites and people."

Jaeger was founded in 1884 by an accountant, Lewis Tomalin, who was inspired by a health craze promulgated by Gustav Jaeger, a professor of zoology from Stuttgart, who believed humans would be healthier if they dressed in clothing made from animal hair, wool and fleece. The first shop was called Dr Jaeger's Sanitary Woollen System. The retailer has 50 stores and 70 department store concessions with closures said to be inevitable. Retail experts suggested it might also sell the valuable lease on its flagship store on London's Regent Street.

When Tillman took on Aquascutum he created a group with combined sales of more than £300m but the brand, which was founded in 1851 by the Mayfair tailor John Emary, has a troubled financial history. He also acquired it without the rights to the important Asian market. They are owned by Hong Kong-based YGM Trading and insiders said it would make sense for it to acquire the rest of the business, although heavy investment is said to be required.

*guardian.co.uk

 

[MulletProof]

I feel so sad for what Aquascutum has been through for what feels like an eternity now. I wish someone was brave enough to invest and exploit all the potential the brand has.. they've had such beautiful collections and built a great archive for anyone to refer to and explore with proper investment.

 

[Chanelcouture09]

Following reports this morning, Aquascutum has confirmed that it has entered administration today and has appointed joint administrators Geoff Rowley and Phil Armstrong - partners at FRP Advisory LLP, the specialist restructuring, recovery and insolvency firm - to oversee the process.
"We are conscious of the value of the Aquascutum brand and its long-standing heritage and because of this are keen to enter in to early discussions with interested parties open to purchasing the business as soon as possible," joint administrator Geoff Rowley said this afternoon. "We will of course be conducting an urgent assessment of all stores and concessions and look to communicate to staff and suppliers at the very earliest opportunity."
The directors made the decsion to begin administration proceedings following "significant losses" over the past year. Between its British stores and its UK-based manufacturing sites, Aquascutum employs 250 people in the UK.

*Vogue.co.uk

 

[Psylocke]

So sad. I've always preferred Aquascutum over Burberry and never quite understood why so many of my friends who go nuts over Burberry don't even know what Aquascutum is. It's a terribly underrated brand. It's one of my favorite traditional British brands and I've always liked their collections, advertising campaigns and their whole image. I hope someone purchases the business and can still somehow save this.

 

[ChrissyM]

Is administration the equivalent of bankruptcy?

Aquascutum is definitely an under appreciated treasure...
it should be every bit as popular as Burberry, it just hasn't had the right systems or supports in place I guess...

 

[lucy92]

^yup, its the british equivalent of a bankruptcy related process.

 

[maybelaterblue]

This is so sad, I've always preferred Aquascutum to Burberry, Daks, and other traditional British labels. I admired Harold Tillman for taking it over but nothing is stable I suppose in the economic climate......Hopefully somebody will buy it soon and it will continue as a brand.

 

[heelscatchfire]

I hope things work out for Aquascutum. I've always loved the brand, their collections and campaigns are always so beautiful.

 

[Chanelcouture09]

It abandoned its legendary central London flagship store on Regent Street last spring, after 110 years.

And now the 160-year-old British clothing brand, Aquascutum, famed for its signature club check, waterproof trench coats and noted clientele from Winston Churchill to the Queen Mother, is reportedly on the brink of collapse.

Owner Harold Tillman sold a majority stake of its sister company Jaeger yesterday, and administrators were called in today, putting some 250 jobs at risk.

An email from the Aquascutum press office also confirmed that the label's forthcoming autumn/winter 2012 press day has been cancelled due to 'unforeseen circumstances'.

Along with Belinda Earl, the former chief executive of Jaeger, Tillman fought to turn the brand around when he acquired it from Japanese company Renown for an undisclosed price in 2009.

It was previously family-owned until Renown bought it for £77m in 1990.

But despite best efforts, the Financial Times understands Tillman can no longer afford to support its losses.

For the year ended 29 December 2007, Aquascutum's UK pre-tax losses nearly doubled to £15.7m, from £7.5m the year before, according to accounts filed at Companies House, and it is thought that they remain at a similar, if not higher, level.Aquascutum was founded in 1851 by tailor John Emary, who invented and patented the technique of shower-proofing wools and was the first to introduce rain repellent cloth. The brand name originates from the two Latin words ‘aqua’ (water) and ‘scutum’ (shield).

He found success providing coats for officers in the Crimean War and both World Wars and decades on Aquascutum designs have been worn by Sophia Loren, Greta Garbo, Sean Connery, Lady Thatcher, Humphrey Bogart and Cary Grant.

Fashion entrepreneur Tillman bought Aquascutum in a deal that united it with Jaeger, which he saved from collapse in 2003, and he has invested some £20 million to reignite its appeal.

But yesterday he sold a 90 per cent stake in Jaeger and all its secured debt to Better Capital - a private equity firm owned by British venture capitalist Jon Moulton, for £19.5 million.

It is understood that the move was to protect Jaeger from any fall-out from the collapse of Aquascutum, which is based in Corby, Northamptonshire.

Currently it's clothes are sold through 11 high street and outlet stores as well as 20 concessions across the UK, including Harrods.

Tillman made his fortune in the rag trade, starting his career in the 1960s with wholesaler Lincroft Kilgour, where he later rose to Managing Director before floating it on the London Stock Exchange.

The south Londoner and Chairman of the British Fashion Council later added to his fortune by buying and selling UK Yves Saint Laurent distributor Marchpole.

Belinda Earl, Aquascutum and Jaeger’s respected chief executive, recently left the business due to health issues.

*Dailymail.co.uk

 

[Chanelcouture09]

This is such a sad ending to such an historical brand .

Following its decision earlier this week to enter administration, Aquascutum has decided to close its UK manufacturing plant in Corby - due to "loss-making operations and a lack of funding" - with a loss of 115 jobs.
"Whilst a difficult decision, it has been necessary in order to stem on-going losses for the business, and to protect the positions of the 135 remaining employees," a spokesperson for the adminstrators said this morning. "We plan to provide appropriate assistance to all affected employees, including liaising with Jobcentre plus and helping with claims to the Redundancy Payments Service. All head office and retail operations across the UK and international high street, concession and outlet stores are operating as usual at present."

The company is in the process of looking for a buyer, and is hopeful that a suitable investor will be found soon.
"We have received a high level of interest from potential purchasers from around the world, with our focus now upon progressing discussions for a sale of the Aquascutum brand and assets," the spokesperson added.

*Vogue.co.uk

 

[Squizree]

Aww this is really really sad. I love this brand so much. I remember when my grandma travelled to UK, buying a new Aquascutum was always a shopping highlight. A brand with so much heritage should easily be able to succeed, especially with a historical image that can be very easily commercialized. Which leads me to believe that the administration of the brand just wasn't good enough. Burberry, for the most part, is doing fine.

 

[Chanelcouture09]

^For the most part ? Burberry had an annual revenue of £1.5billion last year and they also float on the London Stock Exchange.

 

[Street_a_Licious]

what Aquascutum might have needed would be their own Bailey...

 

[Thefrenchy]

A brand with so much heritage should easily be able to succeed, especially with a historical image that can be very easily commercialized.

Agree, that's why I'm very surprised by all this. Couldn't they give it a second chance? It's not some random brand!

 

[Chanelcouture09]

Things may be looking up for the brand... although it was announced a few days ago that they will be closing their factory in Corby, which is an incredible shame.

A host of bidders have entered the race to acquire Aquascutum, including Edinburgh Woollen Mill, Hong Kong-based company Li & Fung, menswear business Cooper and Stollbrand, and YGM Trading - the company that owns the brand in Asia - Retail Week reports today.
"We understand Aquascutum's product, its customers and most importantly, what it takes to maintain, to manage and develop a profitable successful UK factory," Cooper & Stollbrand boss James Eden told The Times.

*Vogue.co.uk

 

[Chanelcouture09]

I would hazard a guess that this brand will become on par with Pierre Cardin, another Licensing Brand dealing in duty-free products.

Aquascutum's administrators announced today that they have entered in to an exclusivity agreement with Hong Kong-based YGM Trading Limited to save the company. YGM - which controls Aquascutum's licences in Asia already - will "acquire the on-going business and assets with completion to take place by May 9, 2012," the administration company said today.
"The joint administrators have been very encouraged by the significant interest shown in the business over the last two weeks and have chosen to proceed with the offer that delivers the best outcome for the creditors of Aquascutum," Geoff Rowley, joint administrator at FRP, said today.
The administrators are also continuing negotiations to secure a buyer for the company's manufacturing plant in Corby, Northamptonshire, which was closed on April 19. No deadline has currently been set for this process.

*Vogue.co.uk