Superdry co-founder Julian Dunkerton today pledged to put in £10 million of his own money as he fights to rescue a business that has been buffeted for years but which he insists can be saved.
The company will delist from the stock market allowing Dunkerton to focus on retailing – and avoids the business falling into administration or being snapped up by Mike Ashley’s Frasers Group.
Other investors may also back the shake-up, but CEO Dunkerton has pledged to underwrite the full amount, a sign of his commitment to the brand. “I love this company” he said.
He made about £80 million when Superdry floated on the stock market in 2010 at a price of 500p. The shares are today at 8p, which leaves the equity valued at £8 million.
He has agreed rent cuts on 39 of the UK’s 94 stores and an extension on loan deals with Bantry Bay and Hilco.
He told the Standard: “The brand has a long-term future. I am very happy to be delisting and going forward with a clear plan.”
He cited All Saints and FatFace as comparable brands that once looked doomed but which have come back to life.
The 3000 staff should be unaffected by the shake-up, at least in the near future.
“My job is to protect jobs,” said Dunkerton. While Superdry’s Oxford Street store is generally regarded as impressive, other outlets are less so.
“I will have more time to go around the stores and be a proper retailer, this will release me to get out there,” he told the Standard.
Superdry said: “Given the material changes to the Company’s business envisioned under the new target operating model, the Company considers it best to implement these changes away from the heightened exposure of public markets. In addition, the Company believes it can achieve significant annual cost savings from the Delisting that will contribute to delivering its target operating model.”
Superdry is far from the only mid-market retailer to have struggled lately. Ted Baker is among the rivals that have found life tough.
Dunkerton said: “At its heart, these proposals are putting the business on the right footing to secure its long-term future following a period of unprecedented challenges. I am aware of the implications for all our stakeholders and I have sought to protect their interests as much as possible in the proposals we are announcing today.”
He added: “My decision to underwrite this equity raise demonstrates my continued commitment to Superdry, its stakeholders, its suppliers and the people who work for it. My passion for this great British brand remains as strong today as it was when I founded the business.”
Superdry started out as a market stall in Cheltenham, was set up by Dunkerton and James Holder, and did enjoy huge commercial success at first. Critics said, like FCUK before it, the brand became too ubiquitous to be cool.
Dunkerton returned to the business as CEO, ousting the rest of the board in the process, in frustration at how they were running a business that is close to his heart.
He still owns 26% of the shares.
Superdry said: “Given the material changes to the Company’s business envisioned under the new target operating model, the Company considers it best to implement these changes away from the heightened exposure of public markets. In addition, the Company believes it can achieve significant annual cost savings from the Delisting that will contribute to delivering its target operating model.”
