French Fashion Group Vivarte SAS Debt Accumulated As High As 1 Billion 500 Million Euros.

France has been deeply reorganized for two years.

The group's Vivarte SAS performance has not improved and its debt has accumulated to 1 billion 500 million euro, and is expected to be further optimized.

Combined with the development of new businesses and new markets to promote growth and reduce debt, the target has become a leader in the footwear industry.

Part of the plan is nothing more than continuing to integrate business. The latest plan is to get rid of the Spanish shoe brand Merkal and reorganize the La Halle brand store network.

Two months ago, the French media had revealed that the group was working for the group.

Fashion brand Kooka, Cowboy brand Chevignon and leisure shoes brand Pataugas look for buyers. Group spokesman confirmed that the sale process had started and lasted for several months.

The specific plan of St phane Maquaire has not been announced, and according to the French media's recommendation to the trade union organization, the main market is the clothing brands of the French suburb, La Halle, the shoe brand La Halle aux Chaussures, and will merge to focus on the low-end market dominated by family customers. The two brands have 1047 shops and employ nearly 6000 employees.

The group said it would assess the store mix based on location and profitability. St e phane Maquaire had two stores to sell 100 stores in the 683 stores of La Halle aux Chaussures, and the trade union said that hundreds of jobs might be lost.

The Merkal, which has an annual income of about 130 million euros, is the third largest shoe retailer in Spain and has about 220 stores. It is reported that the business is growing fast and is one of the most profitable brands in the group, which is intended to provide resources for the five year recovery plan.

The five year recovery plan also includes strategies like digital group activities and modern store network, and it is estimated that 500 million euros will be needed.

St e phane Maquaire also hopes that the new retail concept can become a new driving force for growth, such as the fashion shoe brand Cosmoparis, which was founded in 2008.

Vivarte SAS's La Halle brand store

For continuous brand sales and layoffs, St e phane Maquaire appease employees that his duty is to correct the group rather than dismantle it.

St e phane Maquaire is the third CEO of Vivarte SAS in the past three years.

In 2007, the UK private equity fund Charterhouse Capital Partners LLP bought the Vivarte SAS from the French partner Pai Partners, with a valuation of 3 billion 400 million euros, including debt, and the actual paction amount was only 1 billion 500 million euros.

The subsequent financial crisis and worsening performance led to the debt of Vivarte SAS, which eventually fell into the hands of creditors Charterhouse Capital Partners LLP.

After the reorganization of Vivarte SAS in 2014, it was jointly owned by four investment funds Alcentra Ltd., Babson Capital Management LLC, Oaktree Capital Group LLC, and other creditors, such as the creditors of the company.

At the time, the consortium said it would reduce Vivarte SAS's debt by 2 billion euros, and at the same time inject 500 million euros into the fashion group, but the remaining 800 million euro debt interest rate reached 11%, and the interest rate reached 200 million euros in the past two years.

The new boss then drove the original chairman and chief executive of Vivarte SAS Marc Lelandais, and appointed Richard Simonin in October 2014 to lead the whole reorganization process. In February this year, the group changed hands again. The chief executive officer of the French chain store Monoprix SA, St phane phane, joined the company.

In April 2015, Vivarte SAS announced that it would cut nearly 1500 jobs and close 197 stores.

Now the group includes more than 20 brands, including ANDR, Naf Naf, Caroll, La Halle and so on, with a total of over 20 thousand employees and 4500 stores, with 17000 French employees.

In 2014, revenues declined by 10% to 2 billion 700 million euros, and group revenue decreased by 11% to 2 billion 400 million euros last year.

A group of people familiar with the matter said that the group expected to cut its core profit EBITDA by 2015-16 at the end of August as close to half to 75 million euros from 140 million euros, and blame it on the double impact of the French terrorist attacks and abnormal weather. It is revealed that the weak performance of La Halle is also one of the reasons for the expected downgrade. Annual revenue is expected to continue to fall to 2 billion 200 million euros.

At the end of July, Vivarte SAS hired a special debt restructuring consultant H e l e ne Bourbouloux, who would work with St e phane Macquaire creditors to reach an agreement with the four investment fund creditors.

It is reported that the group has just negotiated a debt payable of 535 million euros with creditors in February, extending from February to November.

On the other hand, one of the shareholders, GoldenTree Asset Management LP, has said early this year that it will reduce Vivarte SAS.