Global labels among Matches creditors to get back very little, offers come in

A new filing by the administrators of Matches shows that there’s been plenty of interest in buying parts of the business but that even if it was sold as a going concern, any new owner would have to deal with its severely dented reputation. 

That’s because many of fashion biggest and most interesting emerging names are among its creditors and they’re unlikely to get back much of what they’re owed.

The good news from administrators at Teneo is that almost £300,000 owed to employees should be paid, as will £1.2 million owed to the UK tax authorities.

But creditors that are owed just under £36 million will be out of luck, a report just filed at Companies House has said. There are over 500 unsecured creditors with major labels such as Gucci, Burberry, Bottega Veneta and Prada owned amounts approaching £300,000 to over £550,000.

What’s worse is that many smaller, less well-funded brands are also owed significant sums. The amounts may often be ‘only’ in the tens of thousands but, they represent a much larger percentage of their overall businesses. The final creditor distribution is likely to be less that 1p in the pound.

The once high-flying luxury fashion omnichannel retailer (which had a value of over £800 million in the last decade) was acquired by Frasers Group for a fraction of that price — £52 million in fact —  late last year. It was put into administration last month with Frasers saying the task to turn it around was just too great.

As for selling it, Teneo said it had received plenty of interest in the business, and honed it down to 11 firm offers for parts of it. The administrators are currently speaking to possible bidders “to achieve the optimum outcome” for stakeholders. Whether that means it might continue as a fashion e-tailer, whether its name might be acquired, or whether it might be liquidated is unclear.

That said, the administrators’ report includes the information that “trading is continuing in the short term with a view to selling the business and/or assets as a going concern”. They believe “that this will achieve a better result for creditors than an immediate winding up of the company”.

The company continues to trade under the administrators’ control, although heavy price-cutting shows it’s clearly not business as usual for the firm. 

But the administrators also said that “critical suppliers were contacted immediately upon appointment to prevent any disruption to trading and undertakings have been provided… to ensure continuity of services”.

Marches had been one of the major players in international online fashion retail, selling to 170 countries. The administrators said that 26% of Matches’ sales were to the UK, 20% to the US, 20% to Asia, 16% to Europe and 18% to the rest of the world.