Superdry to let go of 39 UK stores, delist from London Stock Exchange in major rescue plan

As it tries to stay afloat with a radical restructuring plan, British clothing giant Superdry on Tuesday said that it would delist from the London Stock Exchange and close 39 of its stores across the UK.

It said that through these steps and raising more funds, it might revive the company’s core business. The company would also raise $12.4 million via equity raise as a part of its plan.

For raising equity, the company is exploring two possible options. One, its founder and CEO Julian Dunkerton could underwrite an open offer to raise up to $8.5 million. Or, he could be the only participant in a $12.4 million placing.

Dunkerton holds 26 per cent stake in the company.

In the announcement, the company added that letting go of its stores would help it in delivering “new, more financially sustainable, target operating model”.

The lenders to the company, Hilco Capital Ltd and Bantry Bay Capital, have agreed to the restructuring plan.

Dunkerton said that plan would “put the business “on the right footing to secure its long-term future following a period of unprecedented challenges,” said .

The brand gained popularity in the 2000s. In the past one year, however, its shares have plummeted 94 per cent. It has been suffering widening losses and decline in sales.

Currently, Superdry employs more than 3,000 people worldwide across 200 physical stores and 350 franchisees as well as licensees.

Superdry said that the proposal would not affect suppliers or landlords outside the UK. However, if the plan fails, it would have no option but to consider insolvency proceedings.

“This outcome would leave creditors, including the creditors whose claims would otherwise be compromised by the Restructuring Plan, materially worse off than they would be under the Restructuring Plan,” it said.

Peter Sjolander, chairman at Superdry added, “While we recognise the compromises we are asking from some of our stakeholder groups, we would urge them to support the proposals which we believe are the best way of ensuring Superdry’s recovery over the long-term.”