Esprit provided an update on its European operations after several subsidiaries entered insolvency proceedings.
Esprit said it was looking to exit loss-making operations in Europe and would embark on a new business model that would include optimising its corporate structure and setting up a more flexible and scalable European distribution centre, possibly in the Netherlands.
The company had previously been reported to be seeking potential investors to rescue its European operations.
The news comes shortly after Esprit warned it expects a net loss of HK$1.9 billion in 2023 due to a tough European market.
Esprit said its German subsidiary was in talks for a possible acquisition, while its Swiss and Belgian subsidiaries were likely to be closed.
Esprit added that it is actively seeking capital through various channels with the aim of improving the group's financial position and expanding the company's capital base.
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While some investors have expressed interest in the company with a view to expanding its European operations, Esprit said the funds would primarily be used to pay suppliers to ensure a sustainable supply chain and avoid disruptions to its wholesale business, as well as to rebuild the group's new operational infrastructure systems.
