The brand and intellectual property of the furniture seller will be acquired by the British clothing group.
The British clothing giant Next has bought the brand from bankrupt furniture seller Made.com at a discounted price, with at least 400 employees laid off. Made announced in a press release on Wednesday the appointment of three directors of PricewaterhouseCoopers (PwC) to manage the liquidation, and they immediately entered into an agreement with Next which will acquire the brand, domain names and intellectual property of Made, d ‘after press releases from the company and PwC. Next also specifies in a separate press release that it paid 3.4 million pounds for this transaction.
According to PwC, the company had 573 permanent employees, with warehouses in the UK and Belgium, in addition to offices and stores in London, Europe and Vietnam. “Unfortunately the transaction (with Next) does not take into account the employees and this will result in the dismissal of 320 peoplein addition to 79 other employees who were already leaving, says PwC. A PwC spokesperson contacted by AFP stressed that 100 employees outside the United Kingdom would be notified of their situation in the coming days, while 74 will remain employed by Next to ensure the transition. Administrators should attempt to monetize the remaining assets and “payments to creditors will be made according to their statutory priorities“, specifies the press release. “We are deeply disappointed to have come to this.commented Susanne Given, president of Made.
Read alsoMade.com raises 45 million euros
Made.com announced last week its intention to place itself in administration with a view to its liquidation, and the suspension of its action on the London Stock Exchange, which should be delisted. Known for its comfortable sofas in colorful velvet, the company founded in 2010 has suffered a sudden reversal of fortunes since its IPO in June 2021. Its market capitalization was then some 775 million pounds and its title 200 pence, values gone up in smoke since.
An accumulation of losses
In September, the company which sold its furniture in the United Kingdom, but also in other European countries such as France, Switzerland, Belgium or Germany, announced that it was evaluating several strategic options to raise funds. At the end of October, she said she was interrupting her negotiations with potential buyers and stopping new orders. The society “enjoyed a boom in demand during pandemic lockdowns, when home renovations were in vogue“, but the tide has turned, comments Victoria Scholar, an analyst at Interactive Investors.
Added to this are supply chain issues that have dramatically increased delivery times, and a cost-of-living crisis that is keeping households away from big purchases, she said. She notes a trend among clothing giants like Next and H&M to diversify into furniture and decoration. For Next, acquiring Made’s consumer base, which is younger than its own, is a long-term opportunity, said Richard Lim, managing director of Retail Economics, interviewed by AFP. But Made’s fate also illustrates “the glaring difficulties of the sectorof the distribution, according to him.
After the lifting of health restrictions, consumers returned to stores more than expected, showing that the surge in e-commerce was more circumstantial than permanent. Made, which was accumulating losses, also based its business model on betting on solid and constant economic growth, low interest rates. A world whichhas disappeared» with the return of inflation, logistical difficulties and geopolitical unrest, as pointed out by Nicola Thompson, the general manager of Made, who has apologized to all those who suffer from the bankruptcy.
Orders paid but not yet dispatched in particular will not be finalized, specifies PwC, without saying whether customers will be reimbursed. In a general way, “retailers are currently facing a tidal wave of costswhich forces online stores to sometimes charge for deliveries or returns, which discourages certain orders, underlines Richard Lim. Sign of the times: the M&S chain of stores was unscrewing on the stock market on Wednesday after announcing a drop in its operating profits, eaten by “pressure on costs and prices“.
SEE ALSO – Tech: What Elon Musk’s takeover of Twitter changes