Back in gear as fashion retailer A/Wear sold to rescue firm Hilco
FASHION favourite A/Wear has been sold to Hilco, a company that specialises in rescuing and turning around retailers in trouble.
The high-street fashion chain was struggling under the burden of around €80m in debts.
Financial details of the deal are being closely guarded, but UK-based Hilco said in a statement that it was extending working capital facilities to A/Wear as part of the transaction.
In recent months, Alchemy was reported to be in talks with A/Wear's main lender, Ulster Bank.
The bank agreed to allow A/Wear to defer loan repayments for a year at the end of 2010, but that agreement is due to end around now, putting pressure on the owners to find a solution.
It all suggests the sale is a rescue deal, likely to value the company at a fraction of its previous sale price.
A/Wear has 39 stores in Ireland and three in the UK. It owed €34m to banks, with the rest of the financial debts owed to former owner Alchemy.
Hilco and A/Wear were not available for comment. A spokesman for Alchemy said the private equity house would only comment to thank management and staff for their "tremendous efforts" in a difficult period.
A/Wear was sold for €70m by then owner Brown Thomas back in 2007, at the height of the boom.
The chain was bought by UK private equity firm Alchemy Partners and A/Wear management.
It was backed with loans from lenders including Ulster Bank.