- The Court of Justice opened insolvency proceedings against Esprit Europe GmbH
The Düsseldorf Local Court has opened insolvency proceedings in self-administration for Esprit Europe GmbH, based in Ratingen, and six other German subsidiaries of the fashion conglomerate. This is according to a notice published on the insolvenzbekanntmachungen.de portal. Lucas Floether has been appointed as the insolvency administrator.
The company also issued a press release, informing around 1300 affected employees. Negotiations with works councils are ongoing regarding social plans and reconciliation of interests, with salaries secured until insolvency-related dismissals take effect.
Esprit filed for insolvency in May due to payment difficulties and over-indebtedness. The management of Esprit Europe GmbH has been in talks with potential investors. A decision is imminent, and binding discussions with two bidders are expected to take place in the coming days, pending approval from the creditors' committees and the insolvency administrator.
Both offers involve acquiring the European trademark rights, which are held by the Hong Kong-based Esprit Holding. An agreement with the parent company has already been reached to ensure the rights can be offered securely.
One of the bids proposes a re-launch of Esprit at a later date, while the other suggests continued operations on a significantly reduced scale. Depending on the outcome of the discussions, the management may be forced to scale back operations in the German Esprit entities, either entirely or in large parts, in the coming months.
Esprit operates in around 40 countries worldwide, with its main headquarters in Ratingen and Hong Kong. Germany is the company's most important market, with 57 stores nationwide and 124 in Europe. Esprit Europe GmbH is the parent company for Esprit in Germany, France, Belgium, Austria, the Scandinavian countries, Poland, and the UK. Purchasing and distribution are organized through various European subsidiaries and affiliates.
In 2020, the fashion conglomerate had already applied for protective shield proceedings for several German entities, resulting in the closure of around 50 stores in Germany and the loss of approximately 1100 jobs.
The Bank shall provide necessary financial support during the insolvency proceedings to ensure the continuity of operations for Esprit Europe GmbH and its subsidiaries. This decision is crucial to facilitate the negotiations with potential investors and protect the respective trademark rights held by Esprit Holding.
