UK fashion group feels pinch

The owner of Karen Millen, Oasis and Principles is poised to begin crunch talks with its lenders in a desperate attempt to secure the long-term future of the company. Mosaic, part-owned by Icelandic investor Baugur, is to start talks with the Icelandic bank Kaupthing about its working capital needs amid sliding sales and tough negotiations with suppliers. The business has been hit for months by the withdrawal of credit insurance and now some suppliers are demanding upfront payments, putting pressure on Mosaic's balance sheet. The company is not currently making any interest payments on its estimated £400m debt pile because its loans are under the control of a government-appointed committee now running Kaupthing, following the failure of Iceland's banking system.

Mosaic Fashions is the parent company of eight design-led fashion brands, who's portfolio brands separately design, originate and procure all the merchandise which is sold in their stores. These ranges are sold through 1,760 stores and concessions in the UK, Ireland, Europe and the USA, through 234 Franchise stores in 44 countries and through 93 joint venture stores including 84 concessions in China.

Growth for the Group is through the expansion of its brands internationally, providing a multi-channel offer in all brands by delivering solid performance in existing markets. This development is underpinned by the Group's ability to leverage key skills and experience to drive margin and cost-efficiencies as well as set strategy, allocate resources and manage performance.