It was worth 1 billion USD just 7 years ago. It was the main character behind a 52-million deal three months ago. Now it’s once again for sale as it’s under administration. It’s the parable of Matches Fashion. The Fraser group, which owns it, was surprisingly put under administration, shocking the 533 employees. 273 were laid off right away, while others await instructions, along with suppliers and creditors.
When it was worth 1 billion dollars
Tom and Ruth Chapman founded Matches Fashion in 1987 as a retail store inside Wimbledon Village in London. In 2017 the Chapman family sold the company in an auction to private equity firm Apax Partners. The amount, rumors claimed, was near 1 billion USD. As a consequence of the pandemic, competitors and a business model that never adapted, the company slowly descended into chaos. At the end of 2023 and after liquidity was injected in the company, and a number of CEO changes, Apax sold Matches to Frasers Group for 52 million UK pounds. Fraser’s Mike Ashley probably thought to have made quite a deal and to be able to relaunch the brand. Alice Price, analyst with Globaldata told Vogue Business that Fraser “underestimated the investments necessary and time needed to turn it around”.
Continuous decline
Matched published a loss of 70.9 million UK pounds last January, for the fiscal year 2023. The amount is nearly double the 39.8 million of loss of 2022. The current administrators (Teneo) attributed the negative result to low demand, lower discretional spending, high inflation and high interest rates. But nobody expected that in just two months the company would have gone under administration. According to Fraser, “too many changes and too much time was needed to make the brand recover and the necessary investments were too high”. It was more trouble than it was worth.
And now?
Nobody imagined the end of Matches. The employees and management surely didn’t, breaks the news Vogue Business. Suppliers were also in the dark, and credits may now not be recovered. What we know is that the new administrator, Teneo Financial Advisory, already laid off 273 employees and that matches will continue operating “while it looks for a potential buyer”.
Photo from Shutterstock
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