Private equity firm 3i mulls sale of retailer Hobbs for as much as £80m
It could be a busy New Year for 3i.
Morning Wire understands the British private equity firm is looking to sell clothing brand Hobbs, which it has owned since 2004, for as much as £80m, with investment bank Rothschild being lined up to handle the auction.
3i declined to comment.
The retailer undertook a strategic review of the firm in 2015, and consequently launched a turnaround plan after full-year pre-tax losses rose to £15.6m. Earlier this year, Hobbs reported a rise in full-year earnings and was considering accelerating US expansion plans thanks to sales "outperforming expectations".
Read more: 3i saves more than its spends thanks to uncertain markets
It has been selling in the UK since 1981 and sells through Bloomingdale's in the US. It recently opened its first stand-alone store in New York, with a second due to open later this year.
It comes after 3i announced it had agreed to sell Scandinavian toy company Lekolar, and – subject to regulatory approvals – will see the FTSE 100 firm generate proceeds of around £33m.
The Financial Times first reported that 3i has also hired investment bank Rothschild to sell upmarket lingerie chain Agent Provocateur, which it has owned since 2007.
Read more: Lingerie brand Agent Provocateur gets a refit amid accounting issues
Chris Woodhouse stepped down as chairman of Agent Provocateur last month amid the brand's ongoing inquiry into "accounting issues". As a result, Ian Lobley, a partner at 3i, took the reins.
In November, 3i said Agent Provocateur had been "impacted by declining luxury spend in a number of its key markets", not helped by the "inconsistent execution of its recent store expansion programme and the discovery of accounting issues".