Body Shop rescue on the cards from British cosmetics tycoon Mike Jatania
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The Body Shop is set to be rescued by British tycoon Mike Jatania.
The fate of the beauty retailer has been hanging in the balance since February when its administration triggered 759 job losses and the closure of 82 shops.
But now cosmetics millionaire Jatania is in talks over a deal via his investment firm Aurea.
This has raised hopes that the remaining 116 stores and around 1,400 staff will be saved.
A sale is expected in the next few weeks and Jatania has started due diligence checks, according to a statement by Aurea and administrators FRP Advisory.
Plans include hiring former boss of shower gel brand Molton Brown, Charles Denton, as chief executive.
The statement said: ‘While the deal is not yet complete, we believe the combined experience of the consortium, together with the existing management, represents the best outcome for creditors and will ultimately ensure the long-term success of The Body Shop.’
It said the proposed deal follows a ‘competitive bidding process’.
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Those speculated to have thrown their hat into the ring include Gordon Brothers, the private equity firm behind Laura Ashley, while Marks & Spencer and Next are thought to have taken a look but decided against bidding.
Jatania, 59, previously ran Lornamead, which owned numerous bodycare brands including Yardley, Lypsyl and Harmony haircare.
His partners at Aurea include former UBS banker Paul Raphael and Pharmapacks founder Andrew Vagenas.
But Jatania and Denton face an uphill battle to turn Body Shop around. It had 198 shops and 2,200 staff in the UK when it tumbled into administration in February.
Its collapse came nearly half a century after it was set up in Brighton in 1976 by Anita Roddick.
She and her husband Gordon sold the company to L’Oreal for £652million in 2006. A year later, Roddick died, aged 64, after a brain haemorrhage.
Under L’Oreal, production moved to the Philippines and discounts drove sales.
In 2017 it was bought by Natura & Co, the Brazilian owners of Avon, for £880million. Last November it was sold for a cut-price £207million to German private equity firm Aurelius.
In February, administrators warned its store estate was ‘no longer viable’ after ‘years of unprofitability’ and suggested up to 100 shops could close.
It shut stores with the highest rents and other bills. This included in Bristol, Nuneaton in Warwickshire and Ashford in Kent, and four in London.
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