Administrators exploring sale of accessories chain Claire’s UK

Fashion accessories and jewellery giant Claire’s has fallen into administration, with administrators now exploring the possibility of a sale of the business, which has more than 300 stores across the UK and Ireland.

The appointment of Interpath Advisory’s Will Wright and Chris Pole as joint administrators of Claire's Accessories UK Ltd, Claire's European Services Limited and Claire's European Distribution Limited on August 13 comes exactly a week after US parent company, Claire’s Holdings LLC, filed for Chapter 11 bankruptcy.

US-based Claire’s, which first fell into bankruptcy in 2018 after being unable to repay a loan, cited decreased footfall, rising debt and a broadly challenging retail landscape as the key factors in its collapse.

The Birmingham-headquartered UK business currently operates 306 stores across the UK and Ireland and employs more than 2,150 people. Prior to the formal appointment of the joint administrators, the move to place the company into administration was described as being part of a "broader effort to protect the long-term value" of the business.

Claire’s Chief Executive Chris Cramer said that the move would “allow us to continue to trade the business while we explore the best possible path forward.”

Following their appointment, the joint administrators say they intend to continue trading the companies in administration while options for the business are assessed. Options under consideration include a sale of the business as a going concern.

Joint administrator and Interpath Advisory UK Chief Executive Will Wright said: "Claire's has long been a popular brand across the UK, known not only for its trend-led accessories but also as the go-to destination for ear piercing.”

"Over the coming weeks, we will endeavour to continue to operate all stores as a going concern for as long as we can, while we assess options for the company. This includes exploring the possibility of a sale which would secure a future for this well-loved brand."

In the 53 weeks to February 3 2024, Claire’s Accessories UK Limited reported turnover of around £137 million, down from slightly over £138 million in the year to January 28 2023, while post-tax losses widened from £3.3 million to £4.7 million. At the time, its fixed assets were valued at around £67.6 million and current assets at £47.5 million, with net assets amounting to approximately £3.8 million.

During the same period, Claire’s European Services Limited reported net sales of £40.9 million, up from around £39.3 million in its previous results, while post-tax profits increased from £477,000 to around £1.7 million. Fixed assets were valued at approximately £8.8 million and current assets at £108.1 million, with net assets amounting to £12 million.

Claire’s European Distribution Limited, meanwhile, reported turnover of €126.7 million (£109 million), down from around €140 million (£120.5 million), while falling from a post-tax profit of €504,000 (approx. £433,750) to a loss of €365,000 (approx. £315,000). Fixed assets were valued at €1 million (£860,600) and current assets at €57.8 million (£49.7 million), with net assets standing at approximately €9.4 million (£8.1 million).

High levels of financial distress in the UK retail sector are leading to attractive M&A opportunities for savvy buyers

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