The American investment company Bluestar Alliance paid 60 million euros to realise a restart for Scotch & Soda, according to the first bankruptcy report. A large part of the purchase price went to the banks.

In March, the Dutch fashion brand filed for bankruptcy due to "serious cash flow problems" following pandemic-related lockdowns as well as the subsequent energy crisis and high inflation.

In November 2022 it became clear that Scotch & Soda needed liquidity to continue its operational activities and to meet its financial obligations to financiers, the trustees wrote in the report. The financiers were not prepared to provide additional financing, so the fashion brand entered a financing process led by a financial advisor. In February this year it turned out that the process was no longer useful.

So, in mid-February, Scotch & Soda decided to engage an M&A advisor to start a sales process aimed at a solvent sale of (the shares in) Scotch & Soda Group. That process had to be completed before March 10. The M&A advisor was able to approach about 50 potential buyers in the Netherlands, Europe, the UK and the US. However, it was not possible to complete the sales process on time.

On 10 March, the Amsterdam District Court appointed an administrator for Scotch & Soda Group. In 10 days time, the administrator was informed by the directors of the company about the state of affairs, after which an insolvent sale was examined in collaboration with the M&A adviser. About 30 potential buyers were approached for this. Some had already entered the process through a previous sales attempt, while some were new to the sales round. In the end, four potential buyers remained, after which Bluestar Alliance emerged as the winner.

This article originally appeared on FashionUnited.NL. Translation and edit by: Rachel Douglass.