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Unbound Group, the owner of Hotter Shoes, is reportedly mulling plans to commence a restructuring process as hopes of a sale of the business have stalled.
According to Sky News, the group has now called on advisers at Interpath to prepare for an emergency restructuring plan, which would require court approval.
A source told Sky that discussions with the advisory firm were only “contingency planning” but acknowledged that a restructure was becoming an “increasingly realistic” outcome.
Earlier this year, the group saw its shares surge after the clothing company announced a possible cash offer by WoolOvers Group, a knitwear company which targets the same demographic. Unbound later backed away from the deal following a “superior” offer from Marwyn Investment Management.
In May however, the group reported that a £10m investment offer from Marwyn fell through, after the investment group cited concerns over the group’s current trading.
It comes as Unbound said the trading environment has “remained challenging” over the first quarter of FY24, with conditions worsening compared with those outlined in a FY23 trading update in January. This has resulted in Q1 revenues being lower than its board previously anticipated.
The group had previously launched a company voluntary arrangement (CVA) in 2020, which resulted in the permanent closure of 46 stores.
In a statement to Sky, Unbound said: “As disclosed in the company’s RNS on the 19th May, the company has initiated a formal review of strategic options which included several possible outcomes, all of which are currently still under consideration.
“No decision has yet been made but as and when any progress or a conclusion has been reached, a further announcement will be made.”
Interpath declined to comment at this time.
