Clarks is reportedly in talks with investors about the sale of a minority stake that would dilute its family shareholders’ controlling stake in the company.
The shoe retailer has approached several private equity firms about a deal, which would involve raising between £100 million and £200 million from external investors, Sky News reported.
The discussions are at a preliminary stage, with the exact sum to be raised and the combination of debt and equity some time from being finalised.
The discussions are one of a number of different options under consideration, and it is still early to confirm whether it will be pursued.
If the deal were to go ahead, the talks are likely to lead to the Clark family’s 85 per cent shareholding being reduced.
The news follows the retailer’s update around its “Made to Last” strategy yesterday which will focus on revitalising the business as it enters its third century of operation.
The plans will involve a total of 900 office-level job losses globally, although 200 new roles being created.
Clarks has initially made 160 redundancies, including 108 job losses at its headquarters in Street, Somerset.
Over the next 18 months, the turnaround strategy will see it make another 700 or so employees redundant.
Clarks chief executive Giorgio Presca is leading the restructuring of the retailer.
Last month, three of the big four accountancy firms had been drafted in to work on a restructuring of Clarks as it attempted to weather the Covid-19 impact on business.
The retailer’s family shareholders have drafted in KPMG to advise them, while Deloitte has been hired by the management team.
Meanwhile, PwC had been engaged by a syndicate of the retailer’s lenders as they assess the impact of coronavirus on its finances.
Despite speculations, Clarks has denied it would explore a CVA.
The retailer has furloughed thousands of its store staff under the government’s Coronavirus Job Retention Scheme, and has been assessing options for the remainder of its workforce.
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