In The Style (ITS) must be breathing a sigh of relief with its shareholders narrowly approving its £1.2m sale to private equity firm Baaj Capital, avoiding an administration filing.
The deal was approved by almost 59% of voters at a general meeting, with the struggling digital fashion retailer set to dispose of the business to private equity investor Baaj Capital. That will lead to the brand’s delisting from the AIM stock exchange and avoid having to place the business in administration.
Reports said founder and chief executive Adam Frisby has agreed to take an equity position in ITS Holdings 2023 (‘Bidco’) as part of the deal and become chief executive of the newly-formed business on completion.
In The Style launched a strategic review in December, led by investment bank Lincoln International, at the same time as Frisby returned as interim chief executive, replacing Sam Perkins.
However, it experienced “challenging” trading in January and February, which resulted in high levels of markdown and a reduction in wholesale demand.
The retailer’s cash position had fallen from £3.2 million at the end of December to £900,000 at the end of February.
At the time, the company said “the outcome of the strategic review may or may not result in a sale of the company or some or all of the group’s business and assets”.
Online fashion retailers targeting the mass-market have had a tough time post-pandemic. After riding the online wave during lockdowns, a large number of e-tailers struggled when shoppers returned to physical stores. Soaring costs for businesses and the cost-of-living crisis have simply added to their woes in recent months.