Authentic provides loan to Ted Baker licensee AARC – report
Authentic BrandsTed Baker
A report in The Times said Netherlands-based AARC — which runs the Ted Baker stores and webstore in the UK and Europe — has received a short-term loan and has been working with financial advisors from FTI consulting in recent months to arrange long-term financing for its business.
Authentic bought Ted Baker last year for £211 million and quickly began outsourcing its operations globally to a variety of different companies under license.
AARC was appointed in April, which was, in hindsight, a bad time to take on a fashion business that had already faced a number of struggles in previous periods. Weakness due to the cost-of-living crisis this year has been added to by weather patterns that have meant the wrong climatic conditions coincided with the timing of certain seasonal drops.
The early summer season was affected by unseasonably cool weather in key markets, but a late heatwave meant that autumn drops were appearing at a time when temperatures were soaring. In the UK, for instance, the weather has only turned more autumnal in recent days.
A number of reports have suggested that fashion sales generally in September and early October have been particularly weak, and it’s likely that Ted Baker’s licensee isn’t the only company seeing cash flow issues.
The newspaper report also cited “City sources”, saying AARC may ultimately need to turn to lenders charging very high rates of interest.
None of the parties concerned have commented.
