The competition to buy Seafolly is understood to have been narrowed down to four parties after the voluntary administrator met with overwhelming interest for the iconic Australian swimwear brand.
It is understood that at least 80 groups had inquired about buying the brand, including private investors, private equity firms and family companies both in Australia and overseas.
The parties short-listed are believed to represent local and offshore groups, with some interested in buying the business through a Deed of Company Arrangement structure and others through a simple acquisition of the asset. It is understood final bids are due by next week, with management presentations held on Friday through a teleconference.
The plan is to secure an agreed deal by the second creditors meeting in August.
Voluntary administrator KordaMentha is said to be up-beat about the level of interest.
Information memorandums for the sale were sent to suitors on July 6, with indicative bids due on July 12. The company fell into voluntary administration last month and it is understood that KordaMentha will shut 15 of its Sunburn stores to boost the company’s profitability.
Some had earlier suspected that the owner, L Catterton, could move to buy the business back — it acquired 70 per cent of the operation in 2014 and the remainder two years ago.
Seafolly is considered a good fit in the portfolio of L. Catterton, which also counts RM Williams within its portfolio and is said to have deep pockets.
L Catterton last year hired Goldman Sachs to sell RM Williams for a lofty $500m, but the business is yet to be divested.
Another possibility is that it could wind up in the hands of the founding Halas family, which ran the business successfully before offloading the entire operation to the Asian-based private equity owner.
Another logical owner could be the private equity firm Allegro Funds Management.
Seafolly owes funds to the ANZ Bank. It has a retail network of 44 stores throughout Australia and 12 stores overseas, and employed about 121 people locally.
The swimwear brand capitalised on the Lycra trend in the 1980s, first adapting it into swimwear. The theory is that the VA appointment could enable the retailer to exit leases and shrink its global footprint in a move that would considerably boost profitability.
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