LONDON — Storied Savile Row tailor Gieves & Hawkes may be shut permanently over its Chinese parent company’s debt if a buyer fails to show up, alongside its sister brand Kent & Curwen.
The two brands, along with men’s wear brand Cerruti, are all owned by Trinity Ltd., a Chinese company sold by the Hong Kong-based sourcing giant Fung Group in 2017 to the $4 billion debt-laden Chinese fashion manufacturing giant Shandong Ruyi Technology Group, which is also the owner of SMCP, Aquascutum and Lycra.
The Times first reported that a restructuring firm has been called in as liquidators seek a buyer, citing a source that “there had been a fruitless attempt to find another Chinese business with links to Shandong Ruyi that could take over the tailoring companies.”
The winding-up order follows a failed attempt by Trinity to appeal against creditors. There will be a vote in Hong Kong on Nov. 4 to determine the fate of the brands.
If no buyer is found, the British tailor is in danger of closing after 250 years of trading. The brand, loved by British royalty, has had a store at 1 Savile Row since 1913 and 58 shops in 25 cities worldwide.
Meanwhile, the other British brand under the Shandong Ruyi umbrella, Aquascutum, has pulled out of Britain after being denied further funding from Ruyi.
Across the English Channel, Shandong Ruyi last month failed to redeem bonds in the company, issued in September 2018, worth 250 million euros, causing concerns that SMCP, the owner of Sandro, Maje, Claudie Pierlot and De Fursac, could fall into the hands of creditors. Owners of the bonds include asset manager BlackRock and private equity firm Carlyle. They can stake a claim to a 37 percent share in SMCP.
On Oct. 7, European TopSoho, a unit of Shandong Ruyi, which has a 53 percent stake in SMCP, launched legal proceedings against bondholders it alleged were seeking to take control of SMCP at a low price.
Shandong Ruyi also failed to seal its planned acquisition of Bally and cut back at Cerruti and other international brands, and has already defaulted on several investments, causing Israeli men’s wear brand Bagir and Japanese apparel firm Renown to file for bankruptcy protection last year.
Faced with mounting debts, Moody’s has downgraded Ruyi’s credit rating several times since late 2019. The struggling group lost its key backer in June 2020. The state-owned Jining City Urban Construction Investment Co. Ltd., which promised Ruyi Group a 3.5 billion renminbi, or $495 million, investment last year, walked away in the end. The investment was supposed to provide a much needed cash injection and an endorsement from the local government.
In an interview with the local press around that time, Yafu Qiu, chairman of the company, said Ruyi no longer wants to be China’s LVMH Moët Hennessy Louis Vuitton and that the group will focus on restructuring its portfolio, high-tech fabrics, automated production and fashion brand management to improve its profitability, instead of global acquisitions.