This article is from the Australian Property Journal archive
ASX-listed retailer Mosaic Brands, the owner of Millers, Rivers, and Katies, has entered voluntary administration just weeks after it announced the end of five of its brands, leaving thousands of jobs at risk and hundreds of shops empty.
The company has more than 2,700 employees and 700 stores across the country. At the end of September it said it would “rationalise” its brand portfolio as part of “driving simplification across the business and focusing resources”, closing the Rockmans, Autograph, Crossroads, W.Lane and BeMe brands, including all stores and websites.
“Over the past few weeks, Mosaic’s board and executive team have progressed plans to restructure, re-align and simplify Mosaic’s operations, as previously announced to the market. These initiatives have included rationalising the Group’s brand and store portfolio and focusing on key growth brands, reducing costs and improving Mosaic’s working capital position,” Mosaic said yesterday in an ASX statement.
“The board wishes to reiterate its belief to those who supported the restructure, to Mosaic’s customers and, most importantly, to Mosaic’s dedicated team across Australia, that the business has a long-term future”.
Vaughan Strawbridge, Kathryn Evans, Kate Warwick and David McGrath from FTI Consulting have now been appointed as administrators, and senior secured lender KPMG’s David Hardy, Gayle Dickerson, Ryan Eagle and Amanda Coneyworth as receivers and managers.
Mosaic said the restructure process has involved discussions with a “wide range of stakeholders, both locally and internationally, including Mosaic’s senior secured lender, suppliers, service providers, landlords and the Australian Competition and Consumer Commission (ACCC)”.
“The group’s leadership received the support of a significant majority of its commercial partners and was confident that the restructure would be in the best interests of all stakeholders, resulting in a more focused and financially stronger retailer, with the expectation that its securities would resume trading on the ASX.
“However, a small number of parties declined to support the restructuring proposal or negotiate a commercial outcome, and a commercially acceptable resolution could not be reached with the ACCC.
“Accordingly, Mosaic’s board made the difficult decision today to appoint administrators.”
Mosaic CEO Erica Berchtold said in a statement, “Mosaic Brands continues to be an exciting opportunity to reshape a business with a clearly defined market proposition for its target customers, and employees, that we can be proud of”.
Hardy said, “We will be seeking to stabilise the operations of Mosaic to preserve the underlying value of the business while endeavouring to serve its customers, with support from its employees and suppliers to minimise business interruption”.
Mosaic’s shares have been suspended since it missed the deadline for lodging its full-year results.
In August of last year, it said it open 40 new Rivers “mega stores” in FY24, mostly in regional areas, after it swung to a $17.1 million earnings profit. It had slashed its store network by 148 sites in net terms during the period, following on from its shuttering of 250 stores during the pandemic. That period saw major landlord Scentre lock Mosaic Brands out of 129 of its own stores after a rent payment stoush.
