French Connection-owned womenswear retailer Toast is being sold to Danish fashion house Bestseller.
In a deal worth £23.3m, French Connection should receive £13.9m after costs and the amount due to Toast founders Jamie and Jessica Seaton, who own 25% between them. French Connection owns the remaining 75%.
French Connection said the sale will allow it to “focus further” on its core retail, wholesale and licensing businesses. The proceeds will be used to support French Connection’s “continued turnaround and return to profitability”.
Toast chief executive Suzie de Rohan Willner is staying on at the business.
Completion of the sale is subject to French Connection shareholder approval, which is expected by the end of April.
In the year to 31 January, Toast generated £19m of revenue compared with £16.7m in 2017, and £1.5m of underlying operating profit before tax compared with £1.1m the year before. Toast had gross assets of £8.8m as at 31 January 2018.
Stephen Marks, chairman and chief executive of French Connection, said: “Toast is a very strong brand, and I have no doubt that the team will continue to develop it further under Bestseller’s ownership and Suzie’s continued leadership.
“The price achieved for Toast reflects the strength of the brand and the business we have built behind it. French Connection will use the transaction proceeds to underpin its core business, allowing us to focus on our priority of returning to sustainable profitability and growth.”
De Rohan Willner joined Toast in November 2015, taking over the day-to-day operations from wife and husband founders the Seatons. As part of a new growth strategy, she has revamped Toast’s womenswear offer and reviewed the pricing architecture.