Bankrupt Dutch fashion chain Scotch & Soda is already making a restart under the wings of American retail group Bluestar Alliance. However, the chain will have to downsize.
Less than a week after the Dutch branch of Scotch & Soda filed for bankruptcy, there is already a buyer. American retailer Bluestar Alliance was founded in 2006 and, in its own words, owns and manages a broad portfolio of consumer and retail brands. These range from luxury to mass retail, with a strong emphasis on department stores, and include sports brand Hurley and Bebe.
The quick pace of the acquisition may come as a surprise, as (former) owner Sun Capital had previously tried to sell the fashion brand at least three times – all unsuccessful. Now that candidates could snap up the clothing chain on more interesting terms, trustee Jasper Berkenbosch immediately started new talks.
Berkenbosch says the acquirer will keep a “fairly large group of employees” on the job, implicitly indicating the chain will be downsizing at least a bit. There may be cuts in the number of countries where the brand operates. Berkenbosch reports that Scotch & Soda will remain present in “selected markets”, including in the Netherlands.
Scotch & Soda had been loss-making since 2019, but that did not stop the chain from aggressively expanding abroad. The company borrowed heavily to finance that expansion, but deferred consequences of the corona pandemic, rising costs and cash flow problems eventually killed the Dutch division. Since the foreign operations admittedly rely heavily on the parent market, the trustees immediately sought a buyer for the whole chain.