The owner of Hobbs has written down the value of its investment in the womenswear retailer by 40% after poor trading in the last quarter of 2013.
Private equity firm 3i, which bought Hobbs in 2004 for £111m, said that the value of its 47% stake in the business had dropped by £14m since September 2013, when it was valued at £35m. Its value in Hobbs had already experienced a significant drop since March last year, when its investment stood at £47m.
Hobbs, which operates more than 140 stores across the UK and Ireland, has not released its Christmas trading results but 3i said “trading weakness in the last quarter of 2013” was to blame for the latest revaluation.
3i revealed that the market remained a challenge for a number of the companies it owns but said that overall its businesses had enjoyed a “good performance”.
Hobbs has recently hired former New Look chief executive Phil Wrigley as chairman, replacing 3i’s Iain MacRitchie who left the womenswear retailer after three years.