Struggling British fashion brand LK Bennett has been bought out of bankruptcy by US restructuring specialist Gordon Brothers, raising the prospect of the closure of its remaining nine UK stores with the loss of around 380 jobs.
Gordon Brothers, which acquired Poundland for £1 last year, confirmed it had bought the global brand and intellectual property assets of LK Bennett for an undisclosed sum after the retailer collapsed for the second time in six years.
The Boston-based company said the women’s fashion label would move to an “asset-light” model, fueling speculation that LK Bennett could become an online-only company. The future of the company premises and the workforce remains uncertain.
Tobias Nanda, head of brands at Gordon Brothers, said LK Bennett remained a “beloved heritage brand” with strong international appeal.
“We are delighted to add LK Bennett to our portfolio and are proud to lead the brand into its next phase of growth and bring its modern luxury to both long-standing followers and new customers around the world,” he said.
LK Bennett was founded by Linda Bennett in the early 1990s with a single store in Wimbledon and became known for its signature shoes, handbags and occasion wear. At its peak, the brand operated more than 200 stores worldwide, but has since shrunk to just nine standalone stores in the UK and 13 concessions.
The company has struggled for more than a decade since investing in private equity firms. Bennett sold a majority stake to Phoenix Equity Partners in 2008 for an estimated £80m to £100m, before later returning as an adviser when profits collapsed. She bought the company in 2017 after it posted a loss of £48 million.
In 2019, LK Bennett entered bankruptcy for the first time and was acquired by Rebecca Feng, its Chinese franchise partner, resulting in the closure of 15 stores. Recent reports revealed the company had made a loss of £3.5m in 2024 and was almost £22m in debt, prompting auditors to warn of “significant uncertainty” over its future.
Nimit Shah, managing director for Europe, Middle East and Africa at Gordon Brothers, said the firm believes LK Bennett is “able to revive under a new asset-light model”, indicating a significant move away from the traditional high street.
The acquisition comes amid continued pressure on the premium fashion sector, which is struggling with weaker consumer demand and rising costs. While some competitors like Reiss and Me+Em have successfully adapted their offerings, LK Bennett has been hampered by what analysts call an outdated business model and slower response to changing tastes.
There was also a wave of restructuring across British retail. Shoe brand Russell & Bromley was acquired from bankruptcy by Next earlier this month, which will result in the closure of most of its stores.
LK Bennett reported sales of £42.1m in the year to January 2024, down from £48.8m the previous year, and swung from a profit of £2.3m in 2023 to an after-tax loss of £3.5m. The company employs around 380 people.
Following the takeover by Gordon Brothers, staff and customers must now wait for clarity on whether LK Bennett’s physical presence on the UK high street will survive the latest rescue.
