Collapsed Australian clothing brand Jeanswest has found a new buyer, saving hundreds of Australian jobs.
The brand signed a sale contract on Monday with Harbour Guidance, the Australian subsidiary of Hong Kong Company, Harbour Guide, KPMG voluntary administrators Peter Gothard and James Stewart announced on Tuesday morning.
The sale means that 106 stores will be saved, alongside up to 680 Jeanswest employees, KPMG said.
Jeanswest has 143 stores in total, but announced last month that it was closing 37 stores in “coming weeks” as part of a restructure, forcing 263 employees into redundancy.
The sale is expected to be completed in mid-March.
KPMG restructuring partner James Stewart said he was delighted with the outcome.
“This is a great result for all parties,” he said. “Retail is a people business and the administrators greatly appreciate the resilience of the Jeanswest staff through the administration process.”
Harbour Guidance managing director George Yeung said the acquisition would be an opportunity to “rejuvenate this iconic brand”.
Jeanswest’s near-collapse just one among many
The initial collapse of Jeanswest came as several other Australian brands and retailers buckled under weak retail conditions.
Speaking to Yahoo Finance, IBISWorld senior industry analyst Tom Youl said the retail sector was struggling so much because of a weak national economy, sluggish wage growth, and the rise of online shopping.
“Several years of declining discretionary incomes have placed significant strain on the budgets of many Australians,” Youl said.
“The bad news for store-based retailers is online players are going to continue to grab a larger share of the pie,” he added.
While Jeanswest has found a buyer, other brands aren’t so lucky.
According to the Australian Bureau of Statistics’ latest figures, the number of unemployed Australians jumped to 726,000, with the jobless rate rising from 5.1 per cent to 5.3 per cent.
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