The COVID-19 epidemic has become the last straw for RENOWN, a long-established Japanese clothing company.
According to news from Japan’s Kyodo News Agency on November 2, RENOWN will officially launch bankruptcy proceedings. In May, the company applied for application of the Civil Rehabilitation Law in order to regain development opportunities. But since then, the company has not found a sponsor to take over the entire company and has started bankruptcy proceedings.
When filing for bankruptcy, RENOWN’s total liabilities reached 13.879 billion yen (approximately RMB 920 million). As a listed company, the company’s products will be delisted from the main board of the Tokyo Stock Exchange. RENOWN became the first Japanese listed company to go bankrupt in 2020.
According to relevant reports from Kyodo News, RENOWN’s bankruptcy was mainly attributed to the continued sluggish sales performance of its main channel, department stores. The COVID-19 epidemic that swept the world in early 2020 became the direct cause of RENOWN’s bankruptcy.
RENOWN was founded in 1902. It has a history of a hundred years and has a very high reputation in Japan. It once had more than 30 international brands under its umbrella. Among them, men’s clothing brand D’URBAN and Aquascutum, a brand originated in the UK, decided to sell in August; while in October, brands such as “arnold palmer timeless” that had not found a buyer were determined to close their stores and cease operations.
RENOWN’s operating difficulties emerged as early as 2010. At that time, Shandong Ruyi Technology Co., Ltd. (hereinafter referred to as Shandong Ruyi), a subsidiary of the Chinese textile enterprise Shandong Ruyi Group, launched its own acquisition plan and set its first target at RENOWN.
In the following nine years, Shandong Ruyi Technology has successively acquired French affordable luxury clothing group SMCP, Swiss luxury brand Bally, and men’s clothing listed company Trinity Holdings. Qiu Yafu, chairman of Shandong Ruyi Group, once said in an interview with the media that Shandong Ruyi Group may become China’s Louis Vuitton Group.
But this goal has no longer been mentioned in the past year or two. Since 2019, Shandong Ruyi Group and its affiliated companies have fallen into a debt repayment crisis.
According to Jiemian Fashion, Shandong Ruyi Group’s 2019 financial report shows that the company’s interest-bearing liabilities such as short-term loans reached 1.463 billion yuan as of the end of 2019. In comparison, the company’s fund balance was 361 million yuan. By mid-2020, according to the company According to the semi-annual report, Ruyi Group’s fund balance dropped to 260 million yuan, but short-term borrowings still remained at 1.4 billion yuan, and long-term borrowing balances also stood at 191 million yuan.
Shandong Ruyi Technology deferred the payment of bond interest twice. In 2020 In March, Ruyi Technology issued “19 Ruyi Technology MTN001” and failed to pay the interest on time on the interest payment date, and the payment needed to be deferred for 3 months. However, after 3 months, the interest payment of “19 Ruyi Technology MTN001” was deferred for another 6 months. Month.
During this period, the Shenzhen Stock Exchange issued a letter of inquiry to Shandong Ruyi, focusing on 9 issues such as cash deposits, prepaid accounts, and related transactions of Ruyi Group, pointing directly to the debt repayment pressure that Ruyi Group is currently facing. Large increase and suspected transfer of benefits to controlling shareholders.
At the same time, according to Tianyancha information, since July, Dong Ruyi Technology Group Co., Ltd. (hereinafter referred to as Shandong Ruyi) has been in constant legal disputes. Among them, Shandong Ruyi and its actual shareholder Qiu Yafu were listed as persons subject to execution three times, and the group’s subsidiaries were also involved in many disputes over sales contracts and lease loan contracts.
Israeli high-end garment manufacturer Bagir officially declared bankruptcy and delisted in June. It is undeniable that Shandong Ruyi Group and its subsidiaries have huge liquidity risks. In this situation, it is obviously unable to take into account those acquired through acquisitions. Companies all over the world. In particular, the sudden new crown epidemic has unexpectedly caused a huge blow to various industries around the world. This makes Shandong Ruyi have to not only help the acquired companies continue to develop, but also help them tide over the difficulties. But in fact, Shandong Ruyi also placed a greater burden on some of the companies it acquired.
Interface Fashion has previously reported that Bagir, an Israeli high-end men’s clothing brand, had reached an acquisition deal agreement with Shandong Ruyi, but it was due to Ruyi’s delay in paying the relevant funds to complete the transaction, coupled with the impact of the new coronavirus epidemic. , officially declared bankruptcy and delisted in June.
Now, the same fate has befallen RENOWN again. In addition to the long-term lack of improvement in the business situation and the epidemic, RENOWN’s bankruptcy was partly due to the failure to collect 5.3 billion yen of accounts receivable from its parent company Shandong Ruyi’s subsidiaries in a timely manner. </p
