Claire's UK: Hilco, Modella, and Doug Putman vie for acquisition

According to media reports, Hilco Capital has re-entered the race to acquire the UK and Ireland business of Claire's, just weeks after initially pulling out. The move comes as Claire's, which went into administration on August 13, seeks a buyer to save its 306 stores and 2,150 jobs.

Hilco Capital joins a list of prospective buyers that includes Modella Capital, which recently acquired WHSmith, and Doug Putman, the businessman credited with saving HMV in 2019. Both have reportedly submitted formal bids.

A potential deal for the UK and Ireland operations could be valued as low as 1 pound due to complex financial ties with its bankrupt US parent company, which filed for Chapter 11 in early August. Financial reports indicate that a significant restructuring would be required, as only about 100 of Claire's 306 stores are considered commercially viable. Claire's has reported losses of 25 million pounds over the past three years, primarily due to rising costs, inflation, and competition from online retailers like Amazon and Temu.

The struggles at Claire's reflect a broader trend impacting the British high street. Rising costs, declining foot traffic, and reduced consumer spending are affecting numerous retailers. According to the Centre for Retail Research (CRR), around 17,350 retail outlets are expected to close this year, following a difficult 2024 when 13,000 stores permanently closed.

Major retailers like River Island and Poundland have also faced challenges, avoiding administration by agreeing to restructuring plans that involve store closures. River Island is expected to close up to 33 stores, while Poundland's plan includes closing 68 locations. The British Retail Consortium has projected that an increase in national insurance contributions for employers will cost the sector 2.3 billion pounds this year. Looking ahead to 2025, the CRR predicts the loss of up to 202,000 retail jobs, surpassing even pandemic-era numbers.