Bed retailer Dreams has been acquired by private equity firm Sun European Partners, securing new investment and saving nearly 2,000 jobs, it has been confirmed.
Restructuring specialists Ernst & Young were appointed administrators to the retailer late yesterday and immediately sold the business and assets to Sun European for an undisclosed sum.
Sun European has acquired 171 stores, Dreams‘ head office, its two UK manufacturing facilities and supply chain network though the remaining 93 stores not included in the sale will remain in administration.
Dreams will maintain 1,675 employees as part of the move and Sun European has committed to honour customer orders where part payment deposits have been made for goods and customer warranties.
Joint Administrator Alan Hudson noted that Dreams has faced tough market conditions as discretionary spend among consumers continues to struggle, adding: “Whilst recent performance has improved, it has seen a decline in like for like sales across its store portfolio as well as its operating margins being squeezed.
“This has resulted in the business being unable to continue to operate outside of Administration.
“However, we are pleased to announce that a sale has been completed that sees the majority of the Dreams business including 171 of its stores, its head office and its two UK manufacturing facilities being sold to a new company controlled by Sun Capital Partners.
“The business will continue to trade without interruption, over 1,600 jobs have been transferred and the future of Dreams on the UK high street has been safeguarded.
“The remaining stores that are not included in the sale will remain open for business whilst the Administrators seek to find buyers for these stores.”
Sun European has beaten off stiff competition for the retailer it has been reported, notably from Dreams founder Mike Clare who has been in talks with buyout firm Apollo Management to acquire a number of stores.
Dreams will sit alongside homewares retailer ScS, womens fashion chain Alexon and bed specialist Sharps in Sun European‘s retail portfolio and Jordan Wadsworth, Vice President at Sun European Partners, is positive about the retailer‘s future.
He commented: “Despite operating with an over-expanded store base and significant debt in the precarious economic climate of recent years, the business remains the market leader and, with our support, is now well positioned to capitalise on future opportunities.”