French clothing retailer Vivarte to sell Andre, Naf Naf brands
today Jan 24, 2017
Private-equity backed French clothing retailer Vivarte plans to sell loss-making shoe brand Andre and cut jobs at its Vivarte Services arm as part of larger efforts to restructure the heavily-indebted group, union sources told Reuters.
The company, whose profits and sales have fallen amid competition from larger clothing retail chains such as H&M , Kiabi and Primark, has been trying to restructure its business for several years.
Vivarte's fate is also threatening to become an election issue, with France's Presidential vote due in April and May, since unions fear it could result in as many as 1,500 job cuts out of a total workforce of 17,000.
Andre, which employs 750 people, will be sold to an unnamed buyer, Vivarte told a union meeting on Tuesday, sources said.
The Naf Naf fashion brand, which employs 900 people, will also be sold, the sources added. This adds to plans to sell the Kookai, Pataugas and Chevignon brands decided last year.
At a separate meeting on Vivarte Services, which handles logistics and administrative services, Vivarte unveiled plans to cut 57 jobs out of 250 and transfer 75 jobs, the sources added, while a meeting over the La Halle brand is still under way.
Officials at Vivarte were not available for comment.
Vivarte's debt has doubled over the past two years to about 1.5 billion euros ($1.6 billion), while revenues have fallen to 2.2 billion euros in 2015-16 from 2.4 billion euros in 2014-15.
It closed nearly 300 stores and cut more than 1,600 jobs in France in 2015, and last year ousted chief executive Stephane Maquaire just months after appointing him.
Maquaire had presented a 500 million euro, 5-year plan that included selling about a hundred shoe stores to help Vivarte get back on track, but faced opposition from shareholders who wanted more assets to be sold, sources close to the issue said.
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