Esprit has started insolvency proceedings for its European holding and for six German companies, also affecting operations in six different markets. The fashion retailer wants to restructure its European operations and is talking to investors.
Untenable situation
Esprit is filing for bankruptcy for its European company Esprit Europe GmbH and for six subsidiaries, the company reported in a press release. Austrian, British, Dutch, French, Polish and Scandinavian operations are also affected by the insolvency proceedings. The fashion chain’s Belgian and Swiss branches went bankrupt earlier this year.
The company’s financial situation had become unsustainable due to high inflation costs, interest rates and energy prices, as well as the aftermath of the pandemic and the impact of international conflicts, the press release explained.
Potential investors
Insolvency proceedings should allow the company to restructure for a sustainable future. Meanwhile, operations can continue: both physical and online shops would remain open. Esprit stresses that it wants to remain active in the six markets. Several potential investors have already expressed interest in entering into a strategic partnership.
This is already the second time in four years that Esprit has to resort to insolvency proceedings: during the pandemic, the retailer already carried out a major reorganisation in Germany and Asia, closing some 100 shops and cutting a third of its staff.
