Superdry plc plans to quit the London Stock Exchange (LSE) as the troubled fashion retailer pushes through a radical restructuring to stay afloat.

The British clothing chain, which soared to popularity in the 2000s for its bold lettered tops, said leaving the stock market, raising more funds and implementing a programme to cut some UK store rents and payments owed to local authorities will help it revive the core business.

Shares of Superdry fell nearly 34% in early trading in London. The stock is down 94% in the past year. 

The retailer is looking to raise up to £10 million through an equity raise as part of its rescue plan and will cut rents at 39 of its shops in the UK, according to a statement on Tuesday. 

Lenders Hilco Capital Ltd and Bantry Bay Capital have agreed to the restructuring plan, which will put the business “on the right footing to secure its long-term future following a period of unprecedented challenges,” founder and chief executive officer Julian Dunkerton said.

Superdry warned that if its proposal, which does not affect suppliers or landlords outside the UK, does not go ahead it will have no choice but to consider insolvency proceedings. 

The retailer has suffered widening losses on declining sales, leaving the company with a market value of less than £8 million. The retailer employs more than 3,000 staff worldwide, who oversee 200 physical stores and 350 franchisees as well as licensees.

Dunkerton, who co-founded Superdry in 2003 and holds a 26% stake, tried to take over the ailing brand. He had been in talks with potential finance providers about buying the remaining shares, but eventually abandoned his plan, according to a notice earlier this month. 

The company said on Tuesday it’s exploring two possible options for raising equity: Dunkerton will either underwrite an open offer to raise up to €8 million, or he will be the only participant in a £10 million placing.

Dunkerton returned to the helm in 2019 following a boardroom battle and vowed to turn around a slump in sales and profit. Shares have been under pressure since the start of the year amid concerns about its future.

  - Bloomberg