(Alliance News) - Koovs PLC said Tuesday said the administrators have immediately sold its business and assets to SGIK 3 Investments Ltd, a corporate entity wholly owned by Waheed Alli.
Geoff Rowley and Jason Baker were appointed as joint administrators to AIM-listed fashion retailer.
"The offer from SGIK 3 Investments Limited to purchase the underlying business of Koovs in the UK and in India was the best one we received from a creditors' perspective," said Geoff Rowley.
"There is a legal claim against Future Lifestyle Fashions which will be left with the administrators to try and recover value. This could potentially see a return for creditors, including shareholders, and we will provide an update in due course," added Rowley.
Earlier on Tuesday, Koovs said it has been placed into administration following the failure of its largest shareholder, Future Lifestyle Fashions Ltd, to invest more money into the company.
Koovs said Future Lifestyle Fashions, part of India's largest retail group Future Group, failed to fulfil a contractual commitment to invest a further GBP6.5 million into the company.
The company also said it failed to secure alternative sources of funding.
"The board expects that the business and assets of Koovs will be purchased from the administrator by a company connected to the company's largest secured creditor, Waheed Alli, ensuring the continuation of the operating business," the company said.
As a result, Koovs shares have been suspended from trading and Strand Hanson Ltd has resigned as the company's nominated adviser with immediate effect.
"If a replacement nominated adviser is not appointed within one month, the admission of the company's securities will be cancelled on AIM. The company has no current intention of appointing a replacement nominated adviser," Koovs added.
Koovs shares last traded on AIM in London at 3.24 pence each.
By Paul McGowan; paulmcgowan@alliancenews.com
Updated by Evelina Grecenko; evelinagrecenko@alliancenews.com
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