Body Shop manager starts auction of affected chain

Body Shop

The administrators of The Body Shop are to launch an auction of the chain after concluding that an alternative restructuring of one of Britain’s best-known retailers was not feasible.

Sky News has learned that FRP Advisory, which has overseen the bankrupt company since January, will begin formally sounding out potential buyers in the coming weeks.

The move raises the prospect of new owners taking control The Body Shopwhich was founded almost half a century ago.

The chain now trades from around 100 stores following a store closure and redundancy program implemented in recent months.

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Next showed interest in a deal earlier in the bankruptcy process, while Aurelius, the investment company that took control of the company just weeks before the administrators were called in, is also among the possible bidders.

In a statement to Sky News, an FRP spokesperson said that following discussions with stakeholders about a company voluntary arrangement (CVA), it had “not been possible to reach the necessary agreements to launch a CVA”.

“The joint administrators have therefore decided to initiate a sale process for the underlying activities and assets of TBSI [The Body Shop International].

FRP added that it was “encouraged by the interest received from interested parties to date.”

“The Body Shop remains an iconic brand and following the structural changes we have made to the business since our appointment, we view it as having a viable future.

“This will be shown to potential buyers during the sales process.”

Dame Anita Roddick, founder of The Body Shop, in 2003. Photo: Reuters
Image:
The late Dame Anita Roddick, founder of The Body Shop, is shown after receiving her honor in 2003. Photo: Reuters

Sources suggested that FRP expected to sell the company during the summer.

The curator had informed the creditors of the possible auction in a progress report a few weeks ago.

“In the event that a CVA cannot be agreed, the joint administrators will proceed with the sale of the business and assets,” FRP said in March.

The collapse of The Body Shop in February underlined the demise of a stalwart retail chain founded almost half a century ago by the late Dame Anita Roddick and her husband Gordon.

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February: Body Shop UK enters administration

Aurelius bought the chain from Natura & Co, a Brazilian company that reportedly paid more than $1 billion to buy it in 2017.

According to the management report, Aurelius was confronted with a ‘short-term cash position’ immediately after taking over the chain. [which] was negative compared to what was forecast, due to poor results in fiscal 2023 and the unwinding of the company’s working capital.”

“Prior to the sale to the Aurelius Group, stocks were depleted during the peak Christmas period.”

It is believed that Aurelius continued the business during the administration process.

The Body Shop’s operations in most of Europe and parts of Asia had already been transferred to a family office before the insolvency of the British branch.

Read more:
The Body Shop UK in administration. What went wrong?

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At the time of the sale to Aurelius, The Body Shop employed approximately 10,000 people and operated approximately 3,000 stores in 70 countries.

Although it has struggled with profitable growth for years, it has maintained a prominent presence on the British high street.

The Roddicks were prominent advocates of environmental goals, a positioning that helped them gain an edge over rival retailers in the 1980s and 1990s.

Opposition to testing cosmetics on animals was also unusual in the decades immediately following its founding.

However, its distinctive character has diminished in recent years due to the emergence of competitors who also place sustainability at the heart of their activities.

The Body Shop was owned by L’Oreal, the cosmetics giant, before it was sold to Natura.

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