LK Bennett rescued by Chinese partner but 15 stores are to close

LK BENNETT has been sold to its Chinese franchise partner in a deal that will result in the immediate closure of 15 stores and 110 job losses.

Byland UK, a company formed a few weeks ago by LK Bennett’s Chinese franchise partner Rebecca Feng, bought the collapsed retailer for an undisclosed sum. The purchase includes LK Bennett’s headquarters, 21 stores, all of its concessions and 325 employees. It does not include the company’s international subsidiaries, which will remain in administration.

The retailer ran into financial difficulty after being unable to cope with soaring business rates, an expensive store estate and losing custom as its prices steadily increased.

Dan Hurd, of EY, which is handling the administration, said the company had received a number of offers.

One of those is believed to have been LK Bennett’s founder, Linda Bennett, who is understood to have dropped out of the bidding process earlier this month. She formed the company in 1990 but sold a large chunk of her stake to Phoenix Equity Partners and Sirius Equity in a £100m deal in 2008.

Ms Bennett returned as a consultant two years ago amid falling profits before buying back the entire business and investing in it personally. Ms Feng, who is managing director of Byland UK, said: “There is a real opportunity to expand LK Bennett’s reach in overseas markets where significant untapped potential exists. Under our plan, the business will continue to operate out of the UK, looking to maintain the undoubted heritage of the brand.”

There are three people listed as officers of Byland UK, all of whom are Chinese nationals. A fourth person, Yu Qigang, also a Chinese national, holds 75pc of the company’s shares.

Ms Feng has been working with Darren Topp, LK Bennett’s former chief executive, and Andrew Ellis, its former finance director, on the deal. Both will continue to work for Byland UK.