Baugur (Hamleys, Iceland, House of Fraser) seeks creditor protection

Rochdale_Pioneers

This has been brewing for months. We will now have a fire sale of Bauger companies which will see Arcadia snap up HoF and maybe a few others. As none of the individual businesses owned by Bauger are in difficulty I can't see a wholesale collapse of them - a few maybe if they suddenly can't get credit or run into cash flow problems.

fc123

Kez100 wrote: »

He popped over to Iceland, didn't he, when the country went kaput looking for a deal but Bauger (or someone) sent him home packing. Presumably now some of the interwoven threads of the mess have been untangled it's seen that something has to be done.

To an innocent bystander I am absolutely gobsmacked by the sheer coverage of High Street ownership on the back of what? Debt?

According to the trade press back in October, the mess was too great. They were uncovering all sorts of dodgy, unknown bits and pieces in their books.

He backed off and just waited.

I used to tell customers and they all thought they were 'shopping around', but it's the same as walking into an M + S....but with all the different fascias/styles in seperate shops rather than under one roof.

It has actually cause a huge amount of damage to the whole retail sector...but this won't show up for 2 or 3 years.

The factories they use (all now in F East) are going to get a wake up call too....dealing with mega companies isn't as straightforward as just making the product and collecting the fee.

I read a great article in MWB trade mag (I don't think they publish online..I'll check in a min) about the chains that sell branded goods (USC, Envy) that killed off most of the specialist independents (some trading 25 years) that used to get a brand going in it's early days. This meltdown has only happened in the past 2 years......many more are throwing in the towel this year.

The brand would then go mega and the chains hived it off for themselves. So the indies had to find new labels...and they went mega and the chains gobbled them up and so on.
But USC don't stock start up labels (plus start ups are too small to supply them when they begin) and there is now a lack of Indie stores out there who will retail new looks, styles, brands.

However, the internet has stepped in as the saviour.

fc123

Rochdale_Pioneers wrote: »

This has been brewing for months. We will now have a fire sale of Bauger companies which will see Arcadia snap up HoF and maybe a few others. As none of the individual businesses owned by Bauger are in difficulty I can't see a wholesale collapse of them - a few maybe if they suddenly can't get credit or run into cash flow problems.

No Bauger connected company can get supplier credit....since last September.

Dylanwing

I always wondered how a tiny island, known only for fishing, geysers and Bjork could suddenly be a major player in World business.
And Magnus Manusson of course - The collapse has started, so it will finish.

fc123

Dylanwing wrote: »

I always wondered how a tiny island, known only for fishing, geysers and Bjork could suddenly be a major player in World business.
And Magnus Manusson of course - The collapse has started, so it will finish.

I always thought they were connected to the Russians and The Mafia.
Russia, alledgedly, had a load of washing to do a decade back.
But, now I believe it was just debt.

They helped push the rent on my St. sky high (+ the coffee chains).
Rubbish neighbours too.

We are not in a maainstream area or centre but a well know character area, previously dominated by niche independents.

Every October, we had the Xmas lights fuss. The council don't supply lights so we all clubbed together and bought hanging street lights.

Our St has 8 units, 4 are mega chains. We gave up asking them for a contribution. Manageress would refer to HO...who would say ''F## Off, minion, lesser, annoying indie retailers...WE don't do things like that''.

So, our St is lit up every Xmas at a cost to us of £1000 (paid to council to check electrics) and a contribution to the art gallery who wires them into his own electricity supply....then we all split the bill in Jan.

Named and Shamed; Pizza Express, Costa Coffee, Cafe Nero, 2 X Mosaic fascias.....trade in an Indie area and contribute Zilch...not even £10 subs to the traders association.

Also, any profits they make are sucked out of the local area.

Rochdale_Pioneers

fc123 wrote: »

No Bauger connected company can get supplier credit....since last September.

Its credit insurance that was withdrawn - suppliers can't insure themselves against Iceland etc going bust. That doesn't tend to affect major suppliers who don't take out insurance anyway.

fc123

Rochdale_Pioneers wrote: »

Its credit insurance that was withdrawn - suppliers can't insure themselves against Iceland etc going bust. That doesn't tend to affect major suppliers who don't take out insurance anyway.

That's what I meant and many suppliers refused to issue any credit. All deliveries had to be paid for in advance.

fc123

Rochdale_Pioneers wrote: »

Its credit insurance that was withdrawn - suppliers can't insure themselves against Iceland etc going bust. That doesn't tend to affect major suppliers who don't take out insurance anyway.

Most of Mosaic suppliers (if not all) had credit insurance.
I will try to find the trade mag link (but it has a rubbish search facility).

Rochdale_Pioneers

fc123 wrote: »

That's what I meant and many suppliers refused to issue any credit. All deliveries had to be paid for in advance.

I only know about Iceland on the list of Bauger companies. As far as I know they haven't had demands for Pro Forma (cash up front) terms from any of their suppliers - certainly none of the bigger ones (and the people who supply their own label stuff will be their biggest one)

Ultimately pro forma is self-defeating. In Woolies case their DVD/CD suppliers demanded it, so they had to demand it from their EUK customers (Asda, Morrisons etc). That led to an exodus of customers which put even more pressure on their strained cash flow, which directly caused WWs swift demise at the end of November. The nervy suppliers demanding pro forma had the effect of starving Woolies of cash which sped their demise.

fc123

Rochdale_Pioneers wrote: »

I only know about Iceland on the list of Bauger companies. As far as I know they haven't had demands for Pro Forma (cash up front) terms from any of their suppliers - certainly none of the bigger ones (and the people who supply their own label stuff will be their biggest one)

I know about the clothes bit...risky business at the moment.;)