The turbulence within The Body Shop has now led to the British parent company choosing to liquidate the Swedish subsidiary. According to new information, the collapse was caused by the bank HSBC withdrawing its loans.
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The uncertainty surrounding Body Shop’s Swedish operations has been great. Now it is clear that a decision has been made to liquidate The Body Shop Svenska AB. It entered into force on 19 April.
It is Market who took note of the minutes from an extraordinary general meeting on April 10, where the decision was made to apply for voluntary liquidation. Such usually happens when the owners no longer want to run the business.
Participating shareholders at the general meeting were the parent company The Body Shop International Limited through the reconstructor Geoffrey Paul Rowley.
“After due and careful consideration, the shareholder proposed and decided that the company should enter into voluntary liquidation…” it says, among other things, according to Market.
Dagens Handel has told in a series of articles about the increasingly deeper problems for The Body Shop since the beauty chain was sold at the end of last year by Brazilian Natura & Co to the German investment company Aurelius. When Aurelius announced that a significant part of the operations in Europe and Asia would be sold, a few turbulent months began that have now led to the liquidation of the Swedish company.
According to new data in British The Telegraph then the negative spiral accelerated when the British bank HSBC, which had been a creditor to The Body Shop through the parent company Natura, no longer wanted to lend any money. After new owner Aurelius failed to find new capital, a deficit of at least £100m was created. It then led to the collapse, according to The Telegraph.
A source close to Aurelius claims that prior to the acquisition, the investment company was not informed of HSBC’s decision to cut ties with The Body Shop.
The major problems began to be felt in February when Swedish The Body Shop’s British parent company The Body Shop International Limited was put into reconstruction. Shortly thereafter, The Body Shop filed for bankruptcy in the United States, Canada and Denmark, among others.
This has caused major delivery problems throughout the chain, not least in Sweden.
– They have stopped deliveries and since two months ago I have not received goods, franchisee Maria Lindgren Broman told Sundsvall’s newspaper in connection with her store going bankrupt.
For the same reason, the Swedish webshop has been down since March. Large parts of the Swedish management have also abandoned the sinking ship.
In Sweden, The Body Shop has had around 30 franchise stores and around 35 own stores across the country. The bankruptcies and closings have followed one another over the past year, even before the worst of the turmoil started.
