Manchester retailer Spotlight Group has raised $10 million in a bid to help struggling retailer Mosaic Brands bounce back.
The company, which bought the failed Harris Scarfe chain from administrators Ernst & Young, has taken out about $32 million in convertible notes.
The Mosaic Company is planning to raise up to $35 billion through a rights issue that will give its major shareholders a 36 per cent stake. The offer will also be made on a pro-rata basis.
The notes are convertible into shares after 12 months.
Mosaic, which is mainly focused on the 50-plus age group, is struggling due to the impact of the pandemic. Its stock price has fallen almost 30% since the beginning of the year.
The company’s accounts for the year ended 2021 showed that its net current liabilities were $155.8 million, which were mainly due to the company’s capital raising.
The company, which owns the Noni B and Rivers businesses, said it had raised $145 million through a placing with institutional investors.
The group slashed its costs by $92 million in the past year. It plans to further cut costs this year.
Mosaic booked another multi-million dollar restructuring charge in 2020 following the write-down of its entire portfolio.
For the 12 months to June 27, sales fell 3.8 per cent to $708.8 million, while online sales grew by 19 per cent.
In the first eight weeks of 2022, sales in lockdowns in Victoria and the ACT have fallen. Online sales have also risen.
One of the competitors of Spotlight, Adairs, have been doing extremely well during this period with sales up in both Australia and New Zealand. If you’re looking to buy from Adairs, use an Adairs promo code for your Adairs online purchase.