Oroton to be sold to major stakeholder
After rumours that Gazal, which handles brands such as Calvin Klein in Australia, could possibly buy the bankrupt Oroton, it has come to light that the handbag brand's major stakeholder Will Vicars plans to bail it out.
Oroton has agreed to a sale proposal from Vicars, Oroton's largest shareholder, which would see the struggling handbag retailer continue trading its stores, and keep a current shareholder at the helm of the business.
Deloittes, which was appointed administrator in November, has agreed on Oroton's sale a company controlled by fund manager Will Vicars, who owns 18.2% of the firm.
While exact details are yet to be released, all sale discussions have ceased with other interested parties, which includes Gazal, which owns a 7.35% in Oroton, acquired earlier in the year, and Strandbags Group, which is linked to The Foschini Group.
Voluntary administrator Vaughan Strawbridge said that despite interest, there was no other offer that would have resulted in a better outcome for the business or its employees.
"Despite interest, there was no other offer that would have resulted in a superior outcome for the business or employees," Strawbridge said in a statement.
"Our objective has been to avoid a breakup or closure of Oroton, preserve employment and as much of the Oroton business as is viable, whilst achieving a value maximising result for stakeholders.
"Having regard to each of our assessments of the business, the prior sale process and our market testing process, we believe a fully implemented 'Vicars' proposal delivers on these objectives.
"Entering into this agreement is an important first step in implementing a recapitalisation of Oroton and we will work hard to complete the proposal."
Oroton, founded in 1938 by the Lane family - who still hold a 21% stake in the company's shares - has struggled in the last five years as it lost market share to more recognised foreign brands such as Michael Kors and Kate Spade.
It filed for administration in November as it struggled under the weight of a $40 million debt load.
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