London – Authentic is set to take control of Ted Baker's UK and European retail and e-commerce business six weeks after a souring relationship with a local partner.
Authentic said the British fashion company's US arm would remain unaffected, while its European operations would continue trading through administration.
As reported, Authentic signed a partnership agreement with AARC in April to operate more than 120 Ted Baker retail stores and kiosks, as well as the brand's online operations. The AARC deal, like Reebok, was part of a broader licensing model that Authentic built for Ted Baker.
In February, Authentic announced that despite its best efforts to provide short-term financing to AARC, which has retail operations in 11 countries in Europe, the Middle East and Africa, it was unable to meet its financial obligations. .
The brand management giant has removed AARC as a shareholder in the Ted Baker business and introduced a new independent board of directors to manage operations on AARC's behalf.
All stores in Europe remained open, but the company was unable to find a new retail partner.
John McNamara, Authentic Brands Group's chief strategy and transition officer, said on Tuesday night that “despite our tireless efforts” AARC has caused damage to Ted Baker's European retail and e-commerce business and that ” “We achieved a significant increase in profits,” he said. The amount in arrears was too high to overcome. ”
He added that Authentic wants a better outcome for Ted Baker's employees and associates, and confirmed that Ted Baker's will continue to operate online and in stores. British media reports say hundreds of jobs are at risk.
Mr McNamara said: “We remain focused on securing new partners to sustain and grow the Ted Baker brand in the UK and Europe, its birthplace.”
Authentic is understood to be in “advanced discussions” with several potential operating partners for the Ted Baker brand.
Authentic's other partnerships remain in place and unaffected by the AARC drama. Authentic said in February that it remained committed to Ted Baker despite the challenges facing its UK and European businesses and was confident of the brand's “long-term success”.
As part of the licensing model, Authentic has appointed PDS Group as the global designer and supplier of Ted Baker's core categories. PDS Group also services wholesale accounts in the UK and Europe.
OSL has been designated as Ted Baker's operating partner in North America and is responsible for retail, distribution and e-commerce rights in the region.
