Troubled global fashion retailer Esprit has entered into talks with an international private equity firm over a potential investment in the business as its European struggles continue, according to a report by Morningstar.
The quotes Esprit as saying in a statement on Wednesday that the unnamed investor has expressed interest in submitting a non-legally binding framework memorandum of understanding for a possible partnership, which would see it take control of the company’s European business.
Esprit, which operates in more than 30 markets across Europe, Asia, and America, has already filed for insolvency at its units in Belgium and Switzerland, citing cash flow difficulties amid high energy and logistics costs and weak consumer sentiment. According to Esprit, the investor is also interested in North American and Asian markets.
The Hong Kong-listed group has seen struggled in recent years with losses widening to HKD2.24bn ($286m) in 2023 from HKD642m in 2022, according to its last results.
In a statement, Esprit said: “The potential cooperation is subject to the signing of the definitive transaction agreement. Therefore, the potential cooperation may or may not proceed.”
