Four bidders fight to buy fallen swimwear brand Seafolly, investor announcement expected soon
Seafolly went into voluntary administration in June, but investors have been lining up to buy the iconic swimwear brand. This is where the sale is at.
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The successful bidder for Seafolly is expected to emerge early next week as the administrator of the fallen swimwear brand spends the weekend assessing the final bids.
About 80 parties expressed an interest in buying Seafolly after it fell into voluntary administration late last month.
More than a dozen bids were received for the famous brand which has been fronted by some of the nation’s best known models including Miranda Kerr, Shanina Shaik and Megan Gale.
Those bids have been whittled down to just four, comprising a mix of both local and international parties.
Seafolly administrator Scott Langdon of restructuring firm KordaMentha is assessing the final bids and is expected to nominate the successful bidder by as early as Monday.
“There has been incredible interest in the Seafolly brand from a wide range of investors,” Mr Langdon said.
The sale to the nominated buyer must then be approved by creditors at a meeting scheduled for August 3.
Seafolly and sister brand Sunburn collapsed owing creditors about $43 million, although a large proportion of that is related to loans extended to the swimwear maker from its private equity owner.
Employees are owed about $3.5 million in wage entitlements such as outstanding annual leave, long service leave and redundancy pay, documents lodged with the corporate regulator show.
Seafolly and Sunburn operated 44 stores across Australia – including six in Victoria – and 12 overseas at the time of entering administration.
The label also oversaw a network of around 2700 concessions outlets with other retailers including Myer.
Seafolly stores have remained open but the administrator has closed the 15 Sunburn stores, including one in Victoria.
Creditors have questioned Seafolly’s administrator about whether pushing for a quick sale is in their best interests given the coronavirus cloud hanging over the economy.
Mr Langdon has defended the speedy process, saying Seafolly had been haemorrhaging cash for quite some time.
“The business will likely continue to be cash flow negative which it has been for an extended period,” minutes from the first creditors meeting lodged with the corporate regulator show.
“If the business trades for a prolonged period, it will likely lead to a diminished return to creditors.”
Seafolly was launched from Bondi Beach in 1975.
It is headquartered in Sydney and employed 121 staff before toppling into administration.
It is owned by private equity firm L Catterton Asia which is backed by French luxury fashion and apparel company Louis Vuitton Moet Hennessy.
Aussie bikini labels have found global fame over the past two-decades but fallen on tough times more recently.
Rival swimwear brand Tigerlily, founded in 2000 by Jodhi Meares, collapsed into voluntary administration in March.
Other retailers to call in administrators over the past year include Harris Scarfe, Aussie Disposals, Jeanswest, Bardot, Kikki K, and Colette by Colette Hayman.