The company has endured rising costs and difficult trading, and mild autumn weather is the most recent obstacle it has encountered as it races to reach an emergency cash call agreement with investors.
It has been announced that the parent company of fashion retailer Joules and The Garden Trading Company is on the verge of collapse due to an inability to secure new investments.
The approximately 1,600-employee Joules Group disclosed it would file a notice of intention to appoint administrators and suspend trading in the company’s shares.
“On November 7, 2022, the company announced that it was in advanced discussions with several strategic investors to provide a cornerstone investment in an equity raise process,” the company said in a statement.
“The company also disclosed that it was in discussions regarding a bridge financing proposal to enable continued progress with the aforementioned refinancing plans.
“The board confirms that these discussions with various parties have failed and are now over.”
The Leicestershire-based company stated that it was protecting its creditors.
It has struggled against a backdrop of rising costs and declining sales, as consumer budgets are squeezed by the highest inflation rate in forty years.
Its imminent demise follows that of Made.com, an online-focused furniture brand that laid off nearly 600 employees last week.
Joules, renowned for its wellington boots, operates in Europe and the United States in addition to more than 130 stores in the United Kingdom.
The Garden Trading Company, which sells primarily online but also through stockists, was acquired by the group in the previous year.
The company was in a race against the clock to secure more cash before the end of the month when it was required to repay a $5 million loan.
It had been in discussion with several investors, including Tom Joule, who founded the company at a country fair in 1989 but could not reach an agreement on the proposed cash call or bridge loan.
Mr. Joule remains Joules’ chief brand officer.
Financial analysts predicted that there would be significant interest in acquiring the company’s two strong brands; however, it remained to be seen whether a new owner would wish to retain the majority of the group’s workforce in the current economic climate.
Mr. Joule stated that it was a “sad day for me personally” as he attempted to comprehend the situation.
We acknowledge that our business has grown too complex and that our current model is not optimized for success in the current, competitive marketplace.
“Over the past two months, I have been back at work as a member of the new executive leadership team, trying to streamline the firm and enhance operations.
“While we have made substantial progress throughout this time frame, we were unable to implement the necessary model modifications quickly enough due to the tough circumstances.
“We recognize that today’s news will be very distressing for all stakeholders, including our customers and employees, and we sincerely apologize. However, we would want to inform everyone that business as normal continues at this time.
“I aim to continue to play a significant part in developing Joule’s goods that reflect our brand and values for our customers.
“I am convinced that Joules is still a desired, distinct brand that, with the appropriate business strategy and structure, can thrive once more.”
