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The upmarket fashion brand LK Bennett appears to be heading for collapse for the second time in six years.
On Tuesday the company filed an application with the high court to appoint an administrator to the business, which employs about 280 staff.
The move suggests that the clothing chain, which was founded by Linda Bennett in 1990 and is now owned by China-based backers, appears to have failed in its widely publicised efforts to unearth a saviour.
Should LK Bennett appoint administrators it will be the second time in recent years it has entered insolvency proceedings – despite its reported high-profile fans, who include the Duchess of Cambridge and the former prime minister Theresa May.
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In 2019 the business collapsed into administration after its owners failed to find a new financial backer. It was subsequently acquired out of insolvency by its Chinese franchise partner, Rebecca Feng, who fought off competition from Sports Direct’s Mike Ashley.
The fashion industry had been watching the fate of LK Bennett closely in the run-up to Christmas as the business approached the brink once again. LK Bennett lists just nine UK stores on its website, plus 13 concessions in the UK, Ireland and on Jersey.
In the company’s most recent set of accounts, taking in trading until the end of January 2024, it lost £3.2m and had borrowings of almost £22m. The auditor Grant Thornton warned of “material uncertainty related to going concern” as it reported how the group had breached agreements with its lenders and pointed to a deadline of next month to renegotiate the company’s debt pile.
The accounting group added: “It is expected that there may be a breach [of debt covenants] again … Although a letter has been obtained from the bank stating their intention to continue to make all facilities available until at least 31 January 2026, no formal waiver of the covenants has been obtained.”
LK Bennett has been approached for comment.
By Simon Goodley.
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The chain is working with Alvarez & Marsal to sound out potential buyers and investors, Sky News reported.
