730 jobs saved as pre-pack deal rescues Japanese retailer

The European operations of Japanese retailer Muji have been saved through a pre-pack deal secured by administrators at EY.

733 jobs have been saved at Muji Europe Holdings, the parent company of the lifestyle retailer’s European business, after it was sold to an existing shareholder of the company.

Muji’s Birmingham store is on New Street

Selling a mix of clothes, stationery, furniture and fragrance, trading for Muji had been severely impacted by the effects of Covid-19 and it therefore appointed administrators due to having insufficient liquidity to repay overdue loans drawn down during the pandemic.

Ryohin Keikaku Co. has rescued the European operations with a purchase through Muji Europe. As a result, the business continues to trade normally with 43 staff at its London head office and a further 690 employees at its 32 wholly-owned retail and e-commerce stores, which remain open.

 A company spokesperson told TheBusinessDesk.com that following the restructuring, Muji will receive significant investment from its main shareholder and has plans for new stores and an improved e-commerce offer in Europe.

Muji has a store in New Street, Birmingham, and six in London. Its European holdings company also has stores in Finland, France, Italy, Germany, Spain, Portugal, Switzerland and Denmark, as well as franchise stores in Ireland and Poland. Its global retail operations in 19 countries in Asia Pacific and North America have been unaffected.

TheBusinessDesk.com revealed on March 28 that the retailer had filed a notice of intention to appoint administrators. The move gave Muji 10 days to finalise a way forward while its creditors can’t take recovery action.

Simon Edel, joint administrator at EY said: “The sale of the Company secures the future of Muji’s European business, safeguarding over 700 jobs and 32 retail and ecommerce stores across the UK and Europe. Stores remain open and continue to trade.”