Claire's, the well-known accessories and piercings retailer, is considering a sale amid escalating costs and stiff competition.
Owned by American investors including JP Morgan, Elliott Management, and Monarch Alternative Capital, Claire's boasts a global presence with 2,750 stores and maintains 281 outlets across º£½ÇÊÓƵ high streets and retail parks, as reported by .
Julie Palmer, a partner at the financial consultancy Begbies Traynor, remarked that the move towards exploring a sale comes as "little surprise" in light of rising import costs and the impact of Trump's trade tariffs which are "denting consumer confidence," prompting the company to weigh its strategic options.
Bloomberg has reported that the company's proprietors, with assistance from Houlihan Lokey bankers, have initiated the hunt for a prospective buyer.
Claire's is contending with competitors like Amazon, who benefit from lower-priced Chinese imports, resulting in a downturn in physical store sales and mounting cost pressures.
The brand saw a 0.8 per cent drop in º£½ÇÊÓƵ sales last year, as per the latest figures submitted to Companies House.
"Claire's low-price offering is clearly not strong enough to win over its core customers – teens and young adults – as they now have access to a vast array of affordable and convenient products online through platforms like Amazon and Temu," stated Palmer.
Palmer further noted that with diminishing reasons for consumers to visit their brick-and-mortar locations, the retailer has found it challenging to maintain its relevance.
Claire's, the global retailer with over 2,750 stores spread across 17 countries, could potentially be bought in part or in its entirety by interested buyers.
The company has previously grappled with bankruptcy. In 2018, Elliot Management and Monarch Alternative Capital took control of its stores as former creditors.
Despite a significant recovery since then, the retail giant is staring down the barrel of a looming bank loan debt of $500m (£367m), due for repayment in December 2026.
In an effort to conserve cash, Claire's opted to defer interest payments on this debt, as reported by Bloomberg.
Once a high street staple for Gen Z and millennials, Claire's isn't the only retailer contemplating a sale in recent times.
Earlier this year, WHSmith agreed to offload its 480 stores to Modella Capital, the owner of Hobbycraft, in a deal worth £76m. This transaction will see the stores rebranded as TGJones.
Commenting on the situation, Palmer said: "This news is yet another sign of the immense pressure on high street stalwarts, many of which are being forced to consider job cuts, store closures, or outright sales."
She added: "It's a stark reflection of the tough consumer backdrop, made worse by the uncertainty and cost pressures caused by tariffs."
City AM has reached out to Elliott Management, Monarch Alternative Capital, Claire's and Houlihan Lokey for comment.
Additional reporting by Eliza Bruce-Jones.
