Thu, 08 Dec 2011 | BUSINESS SALE
Having failed to raise the funds needed to rescue the struggling business, Blacks Leisure has now put itself on the market.
The retailer has mandated KPMG with the task of finding a buyer for all or part of the business, which operates 98 Blacks outlets and 208 Millets shops, with the aim of securing a deal in January. Its brands may also be sold, which include Peter Storm and Eurohike.
Blacks’ management warned that a sale would not be likely to bring value to shareholders, considering that its £36 million debts drastically exceed its market value (calculated yesterday) of a mere £3.2 million.
In 2006 the retailer was valued at £250 million, subsequently it has made losses each year since 2007, while its sales have fallen by 30 per cent in three years.
Independent retail analyst Nick Bubb commented to The Times: “The problem with Blacks has always been that its core Blacks chain is not unattractive, but the Millets chain is a millstone around their neck.”
Blacks Leisure lost £16 million in the first six months of this year, and warned that its full-year performance may be worse than previously anticipated.
Read our story on Blacks attempts to secure a rescue deal.
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FREEHOLD
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