Kaupthing says Oasis, in particular, performed well in the first half

Kaupthing says Oasis, in particular, performed well in the first half

Icelandic bank Kaupthing has confirmed it has called off the sale of UK high street fashion chains Coast, Oasis and Warehouse, crediting a turnaround in performance thanks to investment in IT and digital.

Kaupthing, which acquired the three clothing brands in 2009 from Mosaic Fashions, invited banks to pitch for the businesses last October for a mandate to auction the retail assets earlier this year. The group currently operates 750 stores, employing more than 6,000 workers.

Oasis, Warehouse and Coast for sale?

A trade sale is understood to have been one of the options considered, with Kaupthing receiving interest from a number of parties for the business. However, the bank says it has now withdrawn the brands from the sale process following a strong first-half for the three businesses, particularly for Oasis.

However, a report in The Sunday Times suggested the sale had been called off after it emerged the only remaining bidder was an Indian fugitive.

Kaupthing made no comment on this but said it now believes it can drive more value, for the time being, by keeping its ownership and continuing to support the brands, with 24 store and concession openings planned across Europe during the 2017/2018 year.

"We have been in a sale process for the last few months and can confirm today that we have withdrawn from that process," says Paul Copley Kaupthing CEO. "We feel that the market does not currently recognise the value we see in the businesses. We are under no pressure to sell the brands and we look forward to working with their management team to generate value for our stakeholders."

As a group, the three delivered like-for-like sales growth of 4.9%, boosted by Oasis, which recorded an EBITDA performance of GBP11.9m (US$15.7m) for the full year 2016/2017, compared to GBP8.7m the previous year. "Significant" investment has also been made in IT and digital across all three brands, which helped drive e-commerce sales up 18.5% in the first half.