Stefanel seeks agreement with creditors to overcome debt crisis

London - Italian apparel retailer Stefanel has filed a request for an agreement with creditors as part of a new initiative to restructure its crippling debt.

The request, which was filed in court on Wednesday, is a protective measure against bankruptcy and will have to be approved in court first. The filing sees the Italian retailer, led by Giuseppe Stefanel, seek out an agreement with creditors to repay its over 80 million euros in debt.

The move comes as the Italian apparel retailer continues to struggle with mounting debt and weak sales. Stefanel most recent half year financial results showcase the situation was getting worse, as the retailer reported a net loss of 13.3 million euros. Sales dropped 12,6 percent in the first half of the year, from 77.2 million euros to 67.5 million euros compared to the same period in 2015.

Stefanel, which opened a flagship store on Regent Street in 2015, lack the capital to continue operating, and with a financial debt of 87.4 million euros, believes that an agreement with creditors is the only way forward. However, whether the court will grant the agreement remains unclear, as the company has already failed to uphold some financial covenants with banks last year.

The Italian apparel company is said to be seeking a new investors as two of the three companies with with Stefanel holds 56 percent of the company with are in liquidation, whilst the third, FinPiavc has reportedly also requested an agreement with creditors.

Image: Stefanel