Posted 21st June

Bathstore: ‘business as usual’ despite administration rumours

21st June 2019 - 10:03am
bathroom, money matters, bathstore, mbo, buyout, private equity, warren stephens, bikbbi, damian walters, administration, financial, owner, buyer, kbb, kbbdaily

Bathstore has told the British Institute of Kitchen, Bedroom & Bathroom Installation – BiKBBI – that it is “very much business as usual” after reports emerged that the bathroom retailer was on the brink of collapse.

Sky News said it had learnt that the company was in the process of appointing accountancy firm BDO as administrator, with the Guardian adding that it is “understood” that Bathstore’s owner “is unwilling to put in more cash to save the business ahead of this month’s rent day”.

However, Bathstore told the BiKBBI that operations are running “normally” with “all payments being made to suppliers, including installers, as usual too”. Bathstore told that it is not commenting further on the situation at this time.

BiKBBI CEO Damian Walters said: “I understand that this may feel like turbulent times, but be assured that BiKBBI is committed to the ongoing support of its members.” He added that he will “work closely with the Bathstore team” on behalf of installers to communicate updates.

Bathstore is currently owned by American investment banker Warren Stephens, who bought the company in a secondary management buyout alongside Bathstore’s senior management from turnaround investor Endless in 2014.

Endless had bought the business from Wolseley in 2012 for £15m and invested a further £11m in the business over the next two years. The private equity firm said it secured a “significant return on investment” when it sold the company, reported to be a fivefold return.

In its most recent financial report for 2017, Bathstore said it operated 168 stores across the UK and employed around 740 staff. The company noted at the time that it was under some financial strain and its largest shareholder – believed to be Stephens – provided an additional £15m loan to support the group as it developed a turnaround plan.

The company reported revenues of £141m for the period – a 1.5% increase on the previous year – and an EBITDA loss of £4.1m before £11m of exceptional costs. Bathstore’s CEO Gary Favell – who led the management team in the MBO with Stephens – resigned in May last year. The company brought in Ian Herrett – previously UK and Republic of Ireland branch director at Wolseley UK – to replace him.

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