Laura Ashley has filed a notice to appoint advisory firm PwC as administrators after failing to secure an emergency funding lifeline amid coronavirus trading concerns.
The ongoing coronavirus outbreak has had “an immediate and significant impact on trading” at the British heritage brand which stated: “developments indicate that this will be a sustained national situation”.
Therefore, despite announcing yesterday that it was in “advanced discussions” with a third-party lender to provide £15m investment, Laura Ashley has now said it will be unable to secure the funding “in a timely manner sufficient to support working capital requirements”.
The company’s largest shareholder, MUI Asia Limited has confirmed that it is unable to provide financial support in the required timeframe.
Laura Ashley today filed notices of intention to appoint Robert Lewis and Zelf Hussain of PwC as administrators.
The company said: “For the seven weeks up to 13th March, trading for the Laura Ashley business improved by 24% year-on-year and the directors were encouraged by this strong performance. However, the Covid-19 outbreak has had an immediate and significant impact on trading, and ongoing developments indicate that this will be a sustained national situation.
”Discussions with stakeholders have been ongoing and the directors are in advanced discussions for the provision of third-party debt funding. However, based on the company’s revised cashflow forecasts and the increased uncertainty facing the group, the company expects that it will not be in a position to draw down additional funds from third-party lenders in a timely manner sufficient to support working capital requirements.”