Join our community of smart investors

Ted Baker sells HQ to cut debt

The embattled retailer has sold its headquarters to cut debt after Covid-19 forced the closure of most of its outlets
March 23, 2020

Stricken clothing retailer Ted Baker (TED) has sold its headquarters to the British Airways pension scheme for £78.75m in a battle to bring down its debt levels. Ted Baker will put net proceeds of £72m towards deleveraging the company. It has also agreed a short-term lease of the property.

IC TIP: Sell at 132p

Ted Baker has sustained a heavy blow to trading from the coronavirus outbreak, which has forced the temporary closure of 384 of its 416 stores, representing around 68 per cent of its 2020 global retail sales. The company has subsequently agreed a £13.5m extension to its £180m revolving credit facility. The burden on Ted Baker’s balance sheet also will likely also be eased by its decision to cease dividend payments, announced in a December profit warning. 

Ted Baker welcomed the government’s 12-month business rates holiday, having paid £6.2m in business rates over its 2020 full-year. By way of context, the retailer expects underlying profits of £5m to £10m for the period.