Buyers circle New Look as bond prices plummet

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New Look

Potential buyers are reportedly circling New Look, hoping to capitalise on its current financial woes which have caused its bond prices to plummet.

According to The Mail on Sunday, several anonymous buyers are considering buying up swathes of cheap bonds.

This would then put the buyer in a position to seize New Look’s assets should it collapse, or make money as the bond prices rise should it recover.

The potential buyers reportedly consist of hedge funds and vulture funds, including US operator Apollo.

“There’s a good business here but with far too much debt and too many shops,” a senior retail source told The Mail on Sunday.

“The value of the company’s debt has fallen significantly in recent weeks. People in the buyout market are looking at it.”

The collapse in New Look’s bond prices followed reports on Friday that the fashion brand was considering a company voluntary agreement (CVA) in an effort to restructure its ailing finances.

Just days before this, New Look’s leading credit insurer Euler Hermes stopped issuing insurance to its suppliers, in a move that suggests it had lost confidence in the retailer’s ability to avoid insolvency.

The retailer is also thought to be considering a reduction in its estate, looking to close around 60 stores and call for a reduction in rents for its remaining properties.

It is also struggling to stay on top of a massive £1.2 billion debt pile, exacerbated by a £10.4 million loss it made in the six months to September.

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