Aquascutum, the British-based luxury clothing manufacturer which has dressed Queen Elizabeth and Winston Churchill, has gone into administration, the latest high-profile name to fall by the wayside in the consumer downturn. FRP Advisory, the restructuring, recovery and insolvency firm, said two of its partners had been named administrators of the 161-year old loss-making firm, which employs 250 people in the United Kingdom.
Founded by tailor John Emary in 1851, Aquascutum's brand rose to fame before celebrity advertising became mainstream, helped by its long association with the British Royal family.
After King Edward VII first bought an Aquascutum coat in 1897, the slick and expensive rain coats became popular with aristocrats, political leaders and movie stars. The likes of Margaret Thatcher and Humphrey Bogart were often seen wearing the iconic brand.
But in recent years it has struggled, recording financial losses and teetering on the brink of failure.
The company was acquired in 2009 by British entrepreneur Harold Tillman, who also owned the Jaeger brand, but profits stayed in the red and chief executive Belinda Earl departed the business recently due to health issues.
Hopes for a turnaround in the company's fortunes were also hampered by the fact Aquascutum's royalty rights for the Asian market, a high growth area for luxury goods, have belonged to Hong Kong's YGM Trading since 2009.
SALE OF BRAND
With British shoppers' disposable incomes squeezed by rising prices, muted wage growth and government austerity measures, a number of retail chains have faced tough conditions.
The 156-year-old British luxury group Burberry, which also makes iconic raincoats as well as leather goods, reported a slowdown in quarterly sales growth on Tuesday, sending shares down five percent.
Aquascutum operates three high street stores, 16 concessions, seven outlet stores, and 11 international concessions. It also runs its manufacturing base from a factory in Corby, Northamptonshire.
"We are conscious of the value of the Aquascutum brand and its long-standing heritage and because of this are keen to enter into early discussions with interested parties open to purchasing the business as soon as possible," said joint administrator Geoff Rowley.
Tillman told Reuters in an interview last May there had been a lot of interest in buying his Aquascutum and Jaeger luxury brands after an approach from a Middle Eastern suitor prompted him to appoint bankers at Rothschild to examine options. He said at the time that he did not feel under any pressure to sell.
However, on Monday private equity group Better Capital PCC said it had completed an acquisition of Jaeger's secured debt and a 90 percent equity stake in the fashion group for 19.5 million pounds. The majority of the cost went on acquiring its secured debt. (Reporting by Drazen Jorgic and James Davey; editing by Philippa Fletcher)