Esprit has started insolvency proceedings for its umbrella European holding and for six German companies. The fashion retailer wants to restructure its European operations and is talking to investors.
Untenable situation
Esprit is filing for bankruptcy in the Düsseldorf court for its European parent company Esprit Europe GmbH and for six German companies. The company reported this in a press release on Wednesday. Operations in the Netherlands, France, the UK, Austria, Scandinavia and Poland are also affected by the insolvency proceedings. In Switzerland and Belgium, the fashion chain went bankrupt earlier this year.
The company’s financial situation has 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, reports the communiqué.
Potential investors
Insolvency proceedings should allow the company to restructure itself for a sustainable future. Meanwhile, operations can continue: shops and online shops would thus remain open. Esprit stresses that it wants to remain active in the market. Several potential investors have already expressed interest in entering into a strategic partnership.
Already for the second time in four years, Esprit has to resort to insolvency proceedings: also during the pandemic, the retailer already carried out a major reorganisation in Germany and Asia, closing some 100 shops and losing a third of its staff.