The High Court has appointed provisional liquidators to the Irish arm of the well-known fashion retailer Karen Millen.
Mr Justice David Keane on Wednesday appointed experienced insolvency practitioners Ken Fennell and James Anderson of Deloitte Ireland as joint provisional liquidators of Karen Millen Ireland Ltd.
The company which sold women’s clothing, footwear and fashion accessories in Ireland was part of the UK-based Karen Millen Group.
It operates two stores, one at Dundrum Town Centre and the other at Kildare Village, and 16 concession stores, which trade under the Coast and Karen Millen brand names in Dublin, Cork, Limerick and Galway.
It employs 82 staff, 23 of whom are full-time while the other 59 part-time, in the stores.
The applications come after the company’s UK parent went into administration.
On Tuesday, certain aspects of the group's brands and intellectual property were sold to online retailers Boohoo, in a process known as a pre-pack.
Seeking the provisional liquidator's appointment Neil Steen SC for the company told Mr Justice Keane that the board had decided that in light of the group's decision to go into administration and the transaction to Boohoo, the Irish company would no longer be able to trade.
The group’s financial position had declined in recent years due to falling consumer confidence and changed shopping habits, increases in business rates, overheads after the Coast brand acquisition. He also cited labour costs and the depreciation in sterling against the euro.
Liabilities
Mr Steen said the Karen Millen group, which was part of the Aurora Fashions Group, had liabilities of £65.9 million (€71.3 million) and its secured lender had stated that it would no longer provide any additional liquidity to the group.
As a result, the group launched an accelerated merger and acquisition process. Following expressions of interests for several parties, Boohoo’s bid for the brand and intellectual property was accepted by its UK administrators.
Counsel said that the appointment of joint provisional liquidators to the Irish company would help in its orderly wind-down.
The joint provisional liquidators will continue to operate the stores and concessions over the coming weeks so that value can be realised from stock held by the company.
The liquidators will be able to deal with the firm’s employees, landlords and concession licensors in a consistent and uniform way, counsel said.
Counsel said that an order was also required from the court to keep the Dundrum store remain open and operated by the provisional liquidators.
This was because there is a provision in the lease that allows the owners of the Dundrum premises to take possession in an insolvency event.
That order, counsel said, would be temporary as the liquidators only want to keep the store open long enough to sell off the stock.
After appointing the joint provisional liquidators, and granting them certain powers including one allowing them to continue to operate the Dundrum store, Mr Justice Keane adjourned the matter to a date later this month.
