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Footwear - £100m investment in Clarks depends on ambitious plan for shops
06 November 2020

Hong Kong-based private equity firm LionRock Capital has announced its intention to acquire a majority stake in footwear group C&J Clark Limited. It said the Clark family would continue to be “a key shareholder” in the 195-year-old business, reports Leatherbiz.

 

 

LionRock said it was preparing to invest £100 million and that this would allow Clarks to build “future, long-term, sustainable growth”, especially in China and other parts of Asia.

It said that, while this investment would help revitalise the shoe brand “as it enters its third century”, the cash injection is still not confirmed. Existing shareholders will have to approve the move in a vote in December.

It is also subject to creditors in the UK and Ireland agreeing to an ambitious proposal regarding the 320 own-brand stores that Clarks has there. Clarks will ask its creditors to reduce the rent for these shops and move to a new arrangement under which property owners will receive income from the shoe brand based partly on lower rent and partly on the turnover the shops generate.

In the case of 60 of the stores, Clarks is going to ask its creditors to agree to zero rent. If creditors refuse these terms, the LionRock Capital investment is unlikely to go ahead.

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