Superdry restructures to cut rents as co-founder leads fundraising

Superdry is planning a restructure which involves making store rent reductions and initiating a fundraising campaign. Company founder, Julian Dunkerton, is supporting this strategy, and as a result, Superdry will exit the London Stock Exchange.

The buying and selling of shares in the business was stopped on Tuesday morning because it lost 25% of its value, dropping to a new all-time low of just over 5p. This decrease means that Superdry is now worth roughly £6m. In the beginning of 2018, Superdry had a high worth of £1.7bn.

The fashion retailer from Britain, which was once a very famous fashion brand known for its fashionable hoodies and jackets, is currently facing challenges. Recently, they announced a reorganization of the company and this came two weeks after Dunkerton decided not to take over the company with his partners.

Superdry is aiming to improve their business by implementing these actions in order to create a more stable foundation. They have cautioned that if the restructuring plan is not implemented, they may need to seek administration.

The company intends to implement a three-year restructuring scheme, which is a legal process that companies facing monetary problems often undertake. The plan is projected to bring about a decrease in rent for 39 locations in the UK, extension of repayment terms for loans, and significant savings from rent and alterations in business rates. The company has a total of 216 shops that it owns, with additional outlets operating under franchise agreements.

Dunkerton, who started vending clothes on a street market in Cheltenham and established Superdry in 2003 alongside a partner, owns 26.4% of the enterprise and is endorsing the funding campaign. The initiative anticipates earning as much as £10m.

According to Superdry, delisting will help them save costs related to being listed and allow them to carry out their plan to turn the company around without so much public scrutiny. It looks like their shares will stop being traded in July.

During the month of January, the corporation announced that it was contemplating shutting down some of its stores and reducing the number of jobs available after undergoing a year of plummeting sales and deteriorating financial results. The brand's attractiveness has declined in the last few years, as it has had difficulty enticing younger consumers, despite partnering with trendsetters and intensifying its advertising efforts on Instagram and TikTok.

Dunkerton expressed that the suggestions presented will position the company in a favorable manner to maintain stability in the long run after facing uncommon difficulties. He acknowledged the effects these proposals will have on everyone involved, and made an effort to safeguard their best interests to the best of his abilities in the announcement made today.

I have chosen to support this equity raise, which shows that I'm still loyal to Superdry along with its supporters, providers, and staff. I continue to have a deep love for this amazing UK brand, just as I did when I established it.

According to Peter Sjӧlander, the leader, they understand that some of the groups they work with may need to make sacrifices. However, they encourage these groups to back the suggestions they have made as they feel it is the most effective approach for the future success of Superdry.

Superdry stated that the current market situation is still difficult and if they do not proceed with their reorganization strategy, the company might have to declare bankruptcy.