The Austrian subsidiary of fashion chain Esprit is now also bankrupt after bankruptcy in Germany. There are no plans to continue the business.
After the bankruptcy of the European branch of fashion chain Esprit in Germany in May, the Austrian subsidiary is now also bankrupt. She filed for bankruptcy at the Salzburg Regional Court on Thursday. According to Stapf Neuhauser Rechtsanwälte, 173 employees are affected. At its peak, there were more than 600. In addition to a decline in turnover, serious planning errors at the head office were the reason for the bankruptcy. A sequel is not planned.
The company still has twelve of its own branches. 13 franchisees use the brand and operate 23 other locations, but are not legally connected to the now bankrupt Austrian subsidiary.
The current assets of Esprit Handelsgesellschaft mbH amount to approximately EUR 4.9 million. According to the law firm Stapf Neuhauser, which represents the management, the debts currently amount to around 8.4 million euros, according to a press release.
The company will be dissolved
The reason for the sharp decline in turnover was serious planning errors within the group. According to the publication, the collection, distribution and sales, as well as the administration of the Austrian subsidiary, were more or less completely centrally managed.
“A resumption of Esprit Group support is not expected,” it said on Thursday. According to the currently available information, the Austrian subsidiary Esprit therefore sees no possibility of continuing. If the administrator to be appointed follows the management’s request, the remaining inventory must be quickly sold, the branches closed, the leases terminated and the company liquidated. Esprit has been active in Austria since 1995. At its economic peak in 2010, the company employed 610 people in Austria and operated 26 of its own branches and 60 partner stores.
With the bankruptcy of seven German Esprit companies in May, almost all support services and all deliveries of goods to the Austrian subsidiary were immediately stopped. “All European national companies are affected by the management errors in the group,” the law firm said. Both the national companies for Denmark and Finland and the retail companies for the Benelux and Switzerland have already filed for bankruptcy. Further bankruptcy filings in other countries are in preparation.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
