Seafolly enters voluntary administration

Swimwear brand Seafolly has added its name to a growing list of well known businesses to fall into administration as COVID-19 buffets the economy.

Seafolly is the latest well known Australian brand to fall into voluntary administration. Picture: Supplied

Popular swimwear brand Seafolly has become the latest victim of the economic shockwaves caused by the coronavirus pandemic and has collapsed into voluntary administration, adding its name to a growing list of failed fashion businesses that now spans department stores, jeans, casualwear, camping gear and apparel.

It was only in March that high-profile swimwear brand Tigerlilly, founded by billionaire James Packer’s former wife Jodhi Meares, called in the administrators, so too did women’s fashion chain owner PAS Group when it collapsed in May as consumers pull back spending in the wake of the health crisis.

The lurch into voluntary administration of Seafolly on Monday will deal an embarrassing blow to the financial and fashion prowess of French luxury goods retailer Luis Vuitton, which bought a 70 per cent stake in the Australian brand for $70m in 2014 through its investment arm L Catteron. L Catteron has spent the last few years buying up global fashion brands, especially in Australia such as outback clothing chain RM Williams and activewear company 2XU.

On Monday, Scott Langdon and Rahul Goyal, of KordaMentha Restructuring, were appointed voluntary administrators of Seafolly. The appointment includes the entities relating to the Sunburn business.

Seafolly has a retail network of 44 stores throughout Australia and 12 stores overseas, and employed around 121 people locally. It was founded in 1975 by Peter and Yvonne Halas who later sold a controlling stake to L Catteron. The swimwear brand liked to think of itself as being ahead of the curve — when the 80s lycra trend hit the world, it was Seafolly who adapted it first into swimwear.

It also became a popular brand among international fashion leaders and its brand ambassadors included supermodels such as Gigi Hadid, Miranda Kerr and reality TV star-turned-model Elyse Knowles. It soon took on an international customer base, appearing in a range of up-market and exclusive department stores as well as launching a boutique in the glitzy resort town of St Tropez in the French Riviera.

But it could not stay above water as the health and economic crisis of COVID-19 sank its sales, a statement from the administrators said.

Mr Langdon reassured customers it would be business as usual for Seafolly customers while the administrators assessed the business.

“All Seafolly gift cards and the popular Beach Club Rewards points will continue to be redeemable at all Seafolly stores. We encourage all loyal Seafolly customers to come to the retail stores and redeem their Beach Club Rewards, plus earn more points.”

Mr Langdon confirmed that KordaMentha would immediately commence a sale-of-business process. Interested parties should contact the KordaMenthaSydney office. “Given the quality of the brand and its reputation, there will inevitably be a high level of interest in purchasing the business,” Mr Langdon said.

Korda Mentha has already received a range of inquiries from investors and other fashion companies interested in looking over the failed business.

Other retailers to collapse recently include Harris Scarfe, Jeanswest, G-Star, Aussie Disposals, Ishka, Bardot, Kikki K, Colette by Colette Hayman and Bardot.