Ellos Group AB is working to find a long-term financing solution and announces its intention to initiate a process for changing the ownership structure of its subsidiary, Ellos Group Nordic. The Nordic fashion and home furnishings chain was recently facing a significant financial crisis. The company had a bond worth 1.5 billion that has matured this summer, and is struggling to make the necessary payments to bondholders.
As part of this process, a change to the board of directors in the Parent Company is also taking place. The ongoing processes are not expected to affect Ellos Group's business relationships or operations, which will continue as usual, nor will they affect suppliers or employees.
On 30 July 2024, the Parent Company entered into a standstill agreement with an ad-hoc group that at the time represented holders of more than 50 percent of the outstanding nominal amount of the bonds, with the aim of creating a stable platform for Ellos Group during the negotiations to find a long-term solution. The negotiations are constructive, and the intention now is to initiate a process for change of ownership structure in Ellos Group.
Photo: Ellos Group.
Ellos Group's business operations are performing well and have shown stable financial progress during the first half of 2024. The results improved in the second quarter despite a challenging market. Adjusted EBITA increased to MSEK 50.3, which is an increase of approximately 22 per cent. compared to the same period in 2023. The Company's ambition is to continue on the strategic path of improving its offering to core customers with a clear focus on increased efficiency, reduced costs, and improved cash flow.
In connection with the ongoing process, the independent board members Arthur Engel, Patrik Illerstig, and Kristina Schaumann are leaving the board of the Parent Company, and consequently the employee representatives as well. The Parent Company views the board change as a natural step in a process of changing the ownership structure in Ellos Group. The remaining board of the Parent Company consists of Robert Furuhjelm together with Terese Ahrens as an alternate. The board will continue to handle the negotiations to find a long-term financing solution, but in the new configuration.
'I would like to thank the board for the incredibly valuable support they have given Ellos Group over the past few years where we have made significant strides forward as a leading Nordic shopping destination as well as for our very positive cooperation,' says Hans Ohlsson, CEO of Ellos Group.
'Together, the board, Nordic Capital, and Ellos Group's management team have laid a solid foundation for profitable growth, resulting in a favourable profit development. With this positive development, the company is well positioned to take the next step,' says Arthur Engel, departing Chairman of the Parent Company.
More information:
Ellos Group
www.ellosgroup.com