Australian plus-size retailer City Chic has confirmed the sale of its US-based Avenue business to Fullbeauty Brands for US$12 million (~A$18 million).
Fullbeauty manages 12 fashion brands in the United States.
The sale is subject to working capital adjustments at completion, and comes as the brand projects a 30 per cent fall in full-year revenue to around $187 million - including Avenue.
The latest sale comes less than a year since City Chic exited its Europe business by selling off Evans alongside inventory.
Its FY24 forecast of adjusted earnings before interest, tax, depreciation and amortisation from continuing operations (excluding Avenue and Evans), is a loss of A$9.3 million.
In an ASX statement, City Chic claimed the divestment aligns with its strategy of focusing on the core AU/NZ and US customer. Completion of the sale is scheduled to occur in July 2024.
City Chic’s lender has agreed to restructure its current debt facility, with a $10 million multicurrency facility and extended maturity to December 2026.
Amid the sale, City Chic is also undergoing a proposed capital raise, which has led the business to execute a trading halt.
Trading of the securities of City Chic will remain in trading halt while this process continues.