Administrators back Napoleon Perdis rescue by China expert and retail exec
The proposal would transfer shares of the company through a Deed of Company Arrangement (DOCA) to Kuba Investments, a private investment company formed by China marketing expert Livia Wang and former Witchery and Marcs executive Henry Lee.
The administrators said in a statement on Thursday that Kuba’s proposal would result in a better return to creditors than if the company were liquidated.
“We received a lot of interest in the business but ultimately have negotiated terms that will enable the business to continue, with Kuba Investments Pty Ltd,” Simon Cathro of Worrells Solvency & Forensic Accountants said in a statement.
Napoleon Perdis, who founded the eponymous makeup brand, put forward his own DOCA proposal at the end of February, but apparently has thrown his support to Kuba’s offer.
Administrators said the makeup artist and his partner, Soula-Marie Perdis, have agreed to a transfer of their shares to Kuba as part of its proposal.
If the Kuba DOCA is approved, the Perdises would continue to bring their creative expertise to the business and remain in roles to ensure the brand continues to thrive and grow under the new ownership structure, Worrells said.
Creditors will have the opportunity to vote on the DOCA at the second meeting of creditors to determine the company’s future on April 8, 2019.
Cathro and the other voluntary administrators from Worrells, Chris Cook and Ivan Glavas, who were appointed by Napoleon Perdis in January, are recommending creditors approve the DOCA.
“As administrators we have undertaken significant investigations into the affairs of the company and weighed up those findings against the benefit that this DOCA and the associated creditors’ trust provides,” Cathro said.
“The benefit of the DOCA is that it allows the business to continue to exist, this being a primary objective of the voluntary administration process.”
Wang, who is managing director of Access Brand Management, a global brand management company headquartered in Sydney, said Kuba’s investment in the makeup brand would keep more than 250 existing staff members in employment and ensure products are available for sale in over 700 storefronts.
“We will leverage off the restructure undertaken by Worrells and continue to work closely with Napoleon, and the teams, to build the brand both in Australia and overseas,” she said.
It is unclear how many Napoleon Perdis stores would remain open under Kuba’s ownership. Administrators closed half of the company’s 56 bricks-and-mortar locations to “right size” the business, which traded profitably during the administration period.
Perdis cited the high cost of rent as a key reason for the business’s troubles. The brand last year signed a significant agreement to sell items in Priceline stores, and the administrators thanked Priceline and Terry White for supporting the brand and embracing the new owners’ and administrators’ vision for the future of this business.