Auction to be held by administrator of Body Shop chain

The Body Shop’s administrators have announced plans to launch an auction of the chain, after determining that an alternative restructuring of the well-known high street retailer was not feasible. FRP Advisory, who has been overseeing the collapsed business since January, will begin reaching out to potential buyers in the upcoming weeks.

This development raises the possibility of new owners taking over The Body Shop, which was established almost fifty years ago. The chain currently operates from approximately 100 stores, following a closure and redundancy program that was implemented in recent months. During the insolvency process, Next had expressed interest in acquiring the company, while Aurelius, the investment firm that gained control of it just weeks before the administration, is also among the potential bidders.

Confirming the news, a spokesperson for FRP stated, “After engaging with stakeholders about a company voluntary arrangement (CVA), it was not possible to reach the necessary agreements for a CVA to be launched. As a result, the joint administrators have decided to initiate a sale process for the underlying business and assets of TBSI [The Body Shop International]. We have been encouraged by the level of interest received thus far from interested parties.”

The spokesperson further added, “The Body Shop remains an iconic brand, and following the structural changes we have implemented since our appointment, we believe it has a viable future. This will be highlighted to potential buyers during the sale process.” Sources have indicated that FRP anticipates finalizing the sale of the business during the summer. The insolvency practitioner had informed creditors of the potential auction in a progress report issued several weeks ago.

According to the administrators’ report, Aurelius was immediately faced with a “short-term cash position that was adverse to the forecast” upon acquiring the chain. This was attributed to poor financial results in the 2023 financial year and the unwinding of the company’s working capital. Prior to the sale to the Aurelius Group, stock levels had been depleted over the peak Christmas trading period. During the administration process, Aurelius continued to provide financing for the business.

It is worth noting that The Body Shop’s operations in most of Europe and parts of Asia had already been sold to a family office before the UK arm went into administration. At the time of the sale to Aurelius, The Body Shop employed approximately 10,000 individuals and operated around 3,000 stores in 70 countries. Despite facing challenges in achieving profitable growth in recent years, the brand has maintained a prominent presence on British high streets.

Founded by the late Dame Anita Roddick and her husband Gordon, The Body Shop was known for its advocacy of environmental causes, which helped it stand out from its competitors in the 1980s and ’90s. Its stance against animal testing in the cosmetics industry was particularly noteworthy during the decades after its inception. However, in recent years, its unique positioning has been overshadowed by the emergence of competitors who also prioritize sustainability in their business practices.

Prior to its sale to Natura, The Body Shop was owned by cosmetics giant L’Oreal. The collapse of its UK arm highlights the challenges faced by the brand.

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