Written by: Keith Tully
Published: 3rd March 2017
Struggling lingerie retail business Agent Provocateur has been acquired out of administration in a pre-pack deal apparently worth tens of millions of pounds.
The buyer is an investment vehicle called Four Holdings, which is part owned by the retailer Sports Direct, which is majority-owned by its founder the controversial billionaire businessman Mike Ashley.
It remains unclear whether or not there will be jobs lost at Agent Provocateur, which has 10 stores around the UK and a workforce numbering roughly 600 people.
Founded in 1994 by Joseph Corré, the son of the famous fashion designer Vivienne Westwood, Agent Provocateur has long been a popular high street chain selling luxury lingerie and high-end underwear.
However, the business has been struggling to generate consistent profits for some years and was sold to the private equity firm 3i in 2007.
Several million pounds were spent on efforts to turn around Agent Provocateur’s flagging performance during the summer of 2016 but it has since been unable to avoid heading into insolvency and administration.
The business’ former owners are reportedly not expecting to receive any money from its sale via the pre-pack administration process.
Weak spending on luxury goods, accounting issues and the inconsistent execution of a store expansion plan are blamed by 3i for the company’s decline in performance in recent months and years, according to the Financial Times.
3i has said that it had no role in selecting Agent Provocateur’s new owner, whose links to Sports Direct mean it is more readily associated with low-cost sporting goods than with luxury retailing.
A statement from Sports Direct said: “We have a 25 per cent shareholding in Four Marketing [owned by Four Holdings] and we are fully supportive of this acquisition.”
Recent reports suggest Mike Ashley is aiming to move away from an association with discount clothing stores and towards the more upmarket end of fashion retailing through the purchase of interests in Agent Provocateur and other brands.
Earlier this year he acquired an 11 per cent stake in the French Connection fashion business and he already owns a controlling stake in the luxury fashion retailer Flannels.
Mr Ashley has been heavily criticised in recent years, by politicians and many others, for some of Sports Direct’s employment practices.