The Manchester-based fast-fashion e-tailer Missguided fell into administration earlier this week as it was unable to pay back creditors.
Missguided appointed Teneo Financial Advisory as administrator on Monday after a winding-up petition was issued by its suppliers, which are owed millions by the former sponsor of the hit reality TV show “Love Island.”
Last month Missguided asked Teneo to explore strategic options for the business, including a possible sale, but a deal could not be reached, even though companies including Boohoo, JD Sports, Asos, Asda, Shein and Frasers Group showed interest.
At the same time, Nitin Passi, founder of Missguided, stepped down as chief executive officer, but remains on the e-tailer’s holding company board after navigating Missguided through its recent fundraising and strategic review.
Gavin Maher, managing director at Teneo, said: “As we continue to see, the retail trading environment in the U.K. remains extremely challenging. The joint administrators will now seek to conclude a sale of the business and assets, for which there continues to be a high level of interest from a number of strategic buyers. We thank all employees and other key stakeholders for their support at this difficult time.”
It’s estimated that more than 140 of Missguided’s 330 employees are at risk of redundancy, while The Guardian reported that more than 80 people had been let go immediately.
An employment law team at Aticus Law later revealed that it has already been in contact with a number of Missguided’s employees as they prepare to sue the company over poorly managed redundancy claims.
Once a British success story, with a highly entertaining four-part documentary titled “Inside Missguided: Made in Manchester” made to reveal the highs and lows of the brand, Missguided has fallen behind compared to competitors like Boohoo and Asos in recent years, and faced a series of supply chain challenges.
Last year the brand received a major cash injection, which included debt and the acquisition of 50 percent of Missguided’s equity, from Alteri Investors, the owner of British bed specialist Bensons for Beds, German women’s brand CBR Fashion and multichannel retailer Versandhaus Walz, to save the company from collapsing.
Missguided will continue to trade while Teneo seeks to sell off the assets.