A CONSORTIUM led by British businessman Mike Jatania is closing in on a deal to acquire a troubled British cosmetics retailer, sources say.
Aurea Holding, an investment company run by Jatania and former UBS Group AG banker Paul Raphael, is in talks to acquire The Body Shop after beating rival bidders in an auction process.
The partnership also includes Charles Denton, former CEO of perfume and cosmetics firm Molton Brown, and Erno Laszlo, according to sources.
The new owners intend to keep all of The Body Shop’s UK stores, according to the people, who asked not to be identified because the information is confidential.
It comes just weeks after FRP Advisory confirmed the chain was up for auction after a restructuring plan was not deemed viable.
The Body Shop still operates from 100 stores and they will continue as usual for now.
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It also employs over 1,500 staff across the UK.
WHAT COULD HAPPEN TO THE INK PLANT?
FRP remains convinced that there are companies that want to buy the chain.
Any potential buyer could be interested in acquiring all or part of the business.
For example, a buyer may choose to buy only the brand name and trademarks without making an offer for physical stores.
When Paperchase collapsed into administration last year, all 106 stores closed.
But the name lives on as Tesco has taken over the brand and its range of stationery, cards and gifts can now be bought online and in selected Tesco stores.
Who was the founder of The Body Shop, Anita Roddick?
DAME Anita Roddick, born 23 October 1942, was a British businesswoman, human rights activist and environmental campaigner.
Throughout her life, Anita was best known as the founder of the Body Shop – a beauty company manufacturing and retailing natural beauty products.
Anita opened her first Body Shop in Brighton in 1976.
The brand first started as a small shop providing quality skin care products in refillable bottles with the belief that this business could be a force for good.
The Body Shop subsequently became a global retail business serving more than 30 million customers worldwide.
A keen campaigner, Anita has become involved in activism for environmental and social issues such as involvement with Greenpeace and The Big Issue.
In addition, the late businessman founded Children on the Edge in 1990 – a charity that helps disadvantaged children in Eastern Europe, Africa and Asia.
In 2007 Anita, who also worked alongside her husband Gordan, sold L’Oréal but still played an active role in the business.
French firm L’Oreal paid £625m for the company, giving Anita and her husband Gordon more than £100m for their 18 per cent stake in the business.
In September 2007, Mrs Anita Roddick, aged 64, died of a cerebral haemorrhage after being admitted to St Richard’s Hospital, Chichester, West Sussex.
Her husband Gordon and her two daughters, Sam and Justine, were by her side.
Before her departure, Anita revealed that she was diagnosed with Hepatitis C in 2004.
The late founder’s illness was first discovered during a routine blood test for a life insurance policy.
She lived with the disease for more than 30 years before it was discovered – until then she suffered from cirrhosis of the liver.
In 2008, a year after her death, Anita’s will revealed that she had given all of her £51m to charity and the rest to tax.
When Wilko collapsed into administration last August, all the shops closed.
The Range purchased the brand and intellectual property and began selling Wilko branded products in stores.
She then launched the Wilko website and in a shock move began opening new Wilko stores on the high street.
Poundland swooped in to acquire 71 Wilko stores and B&M bought a further 51 sites and integrated them into its own brands.
However, until a firm bid is made to save the Body Shop, it will future chain hanging on a scale.
WHY IS THE COMPANY FOR SALE?
The Body Shop collapsed into administration on February 13 and immediately closed shops seven days later.
In April, administrators of the iconic high street brand proposed a company voluntary arrangement (CVA).
A CVA is a method of restructuring that means a business can continue to trade by negotiating its debts, such as reducing rent costs with landlords.
At the time, FRP said it would sell the business and its remaining assets if a CVA could not be agreed.
The Body Shop has also permanently closed its Avon-style Body Shop at Home service and scrapped its Ambassador Program, which was supposed to replace it.
Aurelius, which bought the company last November, also confirmed in January that it had sold the majority of The Body Shop stores in continental Europe and parts of Asia.
Around 500 staff have lost their jobs and more than 270 head office jobs have been cut since the chain went into administration.
The Body Shop closed 82 branches in the following locations in March and April:
- Bury
- Aylesbury
- Beverly
- Blackpool
- Carlisle
- Chippenham
- Farnborough
- The Grimbs
- Halifax
- Hempstead Valley
- High Wycombe
- Hull
- Ipswich
- Kendal
- Kings Lynn
- Loughborough
- Morpeth
- Perth
- Salisbury
- Stafford
- Newton Abbot
- Trowbridge
- Banbury
- Barnstaple
- Basildon
- Bedford
- Bexleyheath
- Blackburn
- Bolton
- Broughton Park
- Camberley
- Carmarthen
- Durham
- East Kilbride
- Edinburgh Gyle Centre
- Edinburgh Princes Mall
- Epsom
- Fareham
- Harlow
- Hastings
- Huddersfield
- Ilford
- Isle of Wight
- Islington
- Lewisham
- Lichfield
- Luton
- Macclesfield
- Middlesborough
- Northampton
- Oldham
- Peterborough Queensgate
- Swansea
- Telford
- Trowbridge
- Wakefield
- Walthamstow
- Wigan
- Wolverhampton
- Bournemouth
- Surrey Quays, London
- Oxford Street Bond Street, London
- Canary Wharf, London
- Cheapside, London
- Nuneaton, Warwickshire
- Ashford Town, Kent
- Bristol Queens Road
HOW DID THE BUSINESS FAIL?
The Body Shop was founded by Anita Roddick and her husband Gordon in Brighton in 1976.
Her goal was to differentiate herself from other beauty retailers by focusing on ethical and natural ingredients.
The brand joined the L’Oreal group in 2006 before being bought by Natura and Co in 2017.
But the move to sell the business to L’Oreal in 2006 was seen by some as the key moment when its fortunes began to turn.
Mark Constantine, co-founder of Lush rival The Body Shop, was its main supplier for years under his previous business.
He previously said that under L’Oreal’s ownership, moving production to the Philippines allowed for better profit margins, but at a cost.
He said: “You can’t make everything cheaper, remove value and make more profit without customers noticing and going elsewhere.
“They’ve lost that feeling you get when you buy a Body Shop product that you’re helping to change the world.”
Why do merchants close shop?
EMPTY shops have become an eyesore on many of Britain’s high streets and are often a symbol of city center decay.
The Sun’s business editor Ashley Armstrong explains why so many retailers are closing their doors.
In many cases, retailers are closing stores because they are no longer the money makers they once were due to the rise of online shopping.
Falling store sales and rising employee costs have made it even more expensive for stores to stay open. In some cases, retailers close shop and reopen a new store at the other end of the high street to reflect how the city has changed.
The problem is that when a big store closes, footfalls fall across the local high street, putting more stores at risk of closure.
Retail parks are becoming increasingly popular with shoppers looking for easy and free parking at a time when local authorities have increased parking charges in cities.
Many retailers, including Next and Marks & Spencer, are closing high street stores and instead taking larger stores to more efficient retail parks.
Boss Stuart Machin recently said that when he moved a tired store in Chesterfield to a large new store in a retail park half a mile away, his sales in the area increased by 103 per cent.
In some cases, stores were closed when the retailer went bust, such as Wilko, Debenhams Topshop, Dorothy Perkins and Paperchase to name a few.
Increasingly, when a chain goes out of business, a rival retailer or private equity firm acquires the intellectual property rights to own the brand and sell it online.
They may continue to open multiple stores if there is customer demand, but there are rarely that many stores or in the same locations.