Retailer Cath Kidston is to shut its 60 UK stores with the loss of more than 900 jobs after a deal was agreed to save its online business but not its shop network.
The announcement, confirming a move first reported by Sky News, means the company’s owners are buying back its brand and website operations after its fall into administration.
Baring Private Equity Asia (BPEA), which has held a stake in the modern vintage fashion retailer since 2014, said it would result in the “cessation of the retail store network”.
It confirmed that only 32 of its 940 staff would see their jobs secured as part of the deal.
The deal is likely to anger landlords and other creditors which face losing significant sums of money as a result of the pre-pack process.
The business, known for its floral and polka dot designs, becomes the latest prominent high street name to fall into insolvency proceedings since the outbreak of COVID-19 with BrightHouse, Debenhams and Laura Ashley having preceded it by calling in administrators.
Cath Kidston chief executive Melinda Paraie said: “While we are pleased that the future of Cath Kidston has been secured, this is obviously an extremely difficult day as we say goodbye to many colleagues.
“Despite our very best efforts, against the backdrop of COVID-19, we were unable to secure a solvent sale of the business which would have allowed us to avoid administration and carry on trading in our current form.”
Cath Kidston was launched by its eponymous former boss in 1993, and rapidly became an internationally recognised brand, with stores in Asia generating substantial sales.
It expanded from a single shop in west London selling car boot finds and vintage fabric into a business offering fashion, homewares and accessories.
The chain made a fortune for its founder when she sold a stake to private equity firm TA Associates 10 years ago in a deal reportedly worth £100m.
In 2014, Baring Private Equity Asia became a substantial shareholder, before taking full control two years later.
However, it has lost more than £27m in the last two financial years, and made a further £11m loss before interest, tax, depreciation and amortisation in the nine months to December.