Hong Kong-listed Esprit Holdings Ltd is in the process of closing its stores in North America and may eventually close all its outlets there if the Europe-focus fashion group fails to find a partner to take care of the business.
"We are continuing our process of closing the stores. It is in line with what we said last September; we have made provisions for the closures," spokesman Patrick Lau told Reuters.
He said Esprit's North American retail subsidiaries were closing and negotiating with their landlords to terminate store leases, but the U.S. and Canadian subsidiaries had not made a decision to file for Chapter 11 bankruptcy or the equivalent Canadian procedure.
"We are still trying to find an appropriate partner to maintain and reinvigorate the presence of our brand in North America," Lau added. He gave no further comment.
Esprit, which competes with Swedish clothing retailer Hennes & Mauritz AB and Spain's Inditex SA, operates about 90 stores in North America.
Last October, Esprit's chief executive told German media that it may shut its North American stores if it cannot sell them as it seeks to bolster its sagging image, and said the closure would take 12-18 months depending on the rental contracts.
The apparel and accessories retailer, which was founded in San Francisco in 1968 and depends on Europe for 79 percent of its sales, is withdrawing from some underperforming markets and at the same time also spending millions of dollars to revive its brand.
Esprit lost as much as 46 percent of its market value in less than a week in September last year after annual profit was nearly wiped out, hit by restructuring charges, and the company admitted its brand had "lost its soul".
Shares of Esprit, which lost 73 percent of their value in 2011, is up more than 15 percent so far this year. That compares with a near 20 percent drop in the benchmark Hang Seng Index last year. The index was up 10 percent so far in 2012.
(Reporting by Donny Kwok; Editing by Chris Lewis)
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