Mercury rising: Biron expansion put on ice

NATIONAL: An ambitious plan to relaunch Biron Apparel back into the sector looks unlikely to eventuate, following its failed investment venture with collapsed wholesaler Mercury Brands Group.

The group was placed into receivership last month after a promised $2 million investment from Biron Capital, a subsidiary of Biron Apparel, failed to proceed beyond due diligence.

The failed capital injection also saw Mercury Brands Group lose a licensing agreement with Australian Horizons, an apparel division of lifestyle company Funtastic, earlier this year.

In an interview with Ragtrader magazine in August, Biron Apparel director Lyndon Charles Reeks said the investment deal was part of a broader, long-term acquisition strategy for the company. Reeks could not comment further at the time due to ongoing negotiations with Mercury Brands Group.

However, when contacted by Ragtrader last week, Reeks again refused to comment on the investment bid or elaborate on any future acquisition plans.

“All I can tell you is the board is currently reviewing several potential projects,” Reeks said.
Biron has remained inactive since mid-2006, when it appointed administrators to its Physico Clothing business and sold off menswear chain Ed Harry to clear mounting debts.

Biron Capital acquired the 170-store menswear chain in September 2005 for $25 million, merging it with Physico Clothing to create Biron Apparel.

Mercury Brands, which formerly traded as Austin Group, has also had its share of difficulties. After posting several consecutive financial year losses, the company lost major shareholder Hawkswood Investments in the collapse of margin lender Opes Prime in 2008.

Mercury Brands Group owned over 20 lifestyle brands including No Fear, French Kitty, Kangol and Rochford Australia and had distribution channels through major Australian department stores.

It posted a loss of $11.4 million for the 2009 financial year, compared with a $7.8 million loss the previous year. Revenue was also down 34.1 per cent to $28.3 million.

Assia Benmedjdoub