Ted Baker has agreed terms for the sale of its London head office, the Ugly Brown Building, for £78.8m.
The company has entered into a deal with a British Airways Pension Trustees unit to sell the entire issued share capital of its unit for a sale consideration of £78.8m.
Ted Baker founder Ray Kelvin, who holds voting rights in respect of 15.5 million shares (representing 34.87% of the issued share capital of Ted Baker), has voted in favour of the sale.
Meanwhile, Ted Baker has temporarily shut stores that account for around 38% of its global retail sales due to the coronavirus outbreak.
The troubled retailer has closed 197 retail stores and concessions out of 416 locations globally with full shutdown in the US, Canada, France, Spain, Germany, Portugal and Belgium. In other markets, the retailer said it was facing reduced trading hours, but added it was too early to provide a guidance for financial year 2020.
However, the fashion retailer said it has seen less supply chain disruption so far from the outbreak and that the majority of its factories in China are now operational. Ted Baker said its “inventory levels are sufficient”, but it was suspending all non-essential capital expenditure and restricting travel to reduce costs and shore up cashflow.
Ted Baker is thought to be about to hire incumbent Easyjet chairman and former New Look chairman John Barton into the same role, The Sunday Times reported.
Barton retired from New Look in August and was succeeded by Michael Roney. Ted Baker declined to comment.
Rachel Osborne, acting CEO, said: “The sale and leaseback of the Ugly Brown Building and future relocation of our head office are significant developments resulting from the broad asset review we have undertaken in recent months.
“This transaction and the agreed additional financing provides further headroom and flexibility, which will support the delivery of our transformation strategy.
”The spread of Covid-19 has led to some unprecedented events around the world and uncertainty for our business and our people. We welcome the support packages so far announced by governments and continue to focus on keeping our customers and employees safe and all of our stakeholders informed. By doing this, and by continuing to transform the way the business operates guided by our strategic priorities, we remain confident we can realise Ted’s exciting, long-term potential.”
Last month Ted Baker announced that it had conducted a review of its operational efficiency, costs and business model after a “very challenging year”, resulting in 102 redundancies.