Esprit seeks HK$5.25 billion for restructuring
Struggling fashion retailer Esprit is looking to raise new capital from investors which will be used to finance a restructuring of the business and to revive its brand.
The company is aiming to secure up to HK$5.25 billion through a one-for-two rights issue of new shares to existing investors. The new stock will be priced at 8 Hong Kong dollars representing a discount of 36% on its closing price on Monday.
The funds raised will be used to revitalise the Esprit brand, improve product processes, refurbish stores, overhaul the product range, and fund retail expansion.
Esprit chairman Raymond Or said: "The directors have decided to undertake the rights issue to give the company financial flexibility and to provide funding for the execution of the transformation plan of the company.
"In making this decision, the directors have considered the current challenging operating environment and economic uncertainties."
In a separate statement to the Hong Kong Stock Exchange, Esprit reported that sales had fallen by 23% to HK$6.6 billion in its first quarter.
Esprit operates more than 1,000 directly-managed stores and more than 10,000 retail stores worldwide.
Email this article to a friend
You need to be logged in to use this feature.
Please log in here