Hotter parent company Unbound Group announced the end of its formal sale process today with ”no potential offers” and confirmed it is exploring an equity raise.
Unbound Group launched a strategic review and drafted financial advisers last month as it considered selling the footwear retailer.
In a statement published to the London Stock Exchange, the group confirmed no offers it received were “considered capable of receiving shareholder and wider stakeholder support” and it emphasised there were no further ongoing discussions with potential offerors.
Interpath Advisory, which Unbound appointed as a joint financial adviser last month, remains in charge of the company’s strategic review process.
Unbound said: “Offers within this process continue to be received and reviewed; however, these offers may result in little or no recovery of value for the company’s existing shareholders.”
It also said recent trading performance had been “encouraging” and, as a result, it is mulling equity fundraising of between £1.5m and £2m “to support the implementation of a formal restructuring plan, with a view to securing a better outcome for the group”.
Unbound emphasised that “there can be no certainty” in its achievement of an equity raise but it remains “encouraged” due to recent profitability being in line with expectations, despite revenues being impacted by “liquidity constraints”.
Unbound added: “The group remains reliant on the waiver of certain covenants under existing borrowing facilities and continues to maintain a constructive dialogue with its core banking partners who have continued with their support throughout this period.”
Following the “seasonally loss-making months” of February and March, the group posted EBITDA of £1.1m for the combined months of April and May, with an EBITDA margin of 14%, up from 9% for the same period last year.
For the first four months of the full financial year, Unbound Group said its EBITDA is at breakeven.
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