(Yicai Global) Nov. 6 -- LionRock Capital has offered to pay GBP100 million (USD131 million) for a majority stake in the iconic British shoemaker C&J Clark, which has been brought to the brink after 195 years in operation by the Covid-19 pandemic, the Hong Kong-based private equity firm said on its website.

The investment will enable the shoemaker to revitalize its brand as it enters its third century, said LionRock, whose chairman is Li Ning, former Chinese Olympic gymnast and founder of a well-known sportswear brand of the same name. The chain will also benefit from the expertise that LionRock can offer to help the Clarks brand grow globally and especially in China and across Asia, it added.

The cash injection will allow Clarks’ 320 shops across the UK to stay open and save jobs, the Somerset-based shoemaker said on Nov. 4.

It would mean that the Clarks family, which still holds an 85 percent stake, will lose control of the firm for the first time since its founding in 1825. The family and other shareholders still need to give their vote of approval, scheduled for next month, for the transaction to go ahead.

As part of the deal, Clarks will enter a company voluntary agreement, which will allow it to negotiate with creditors to settle some of its debts in other forms. Clark is planning to move 60 of its outlets to nil-rent and ask landlords to accept part of a shop’s revenue as payment in lieu of a fixed rent.

“In order to address the permanent shift in structural shopping behavior as a result of the Covid-19 pandemic, the CVA is being launched out of absolute necessity,” said Interim Chief Financial Officer Philip de Klerk. "It is important to stress that we are not announcing the closure of any stores today, and employees and suppliers will continue to be paid," he added.

Li-Ning [HKG:2331] closed up 3.01 percent at HKD44.50 (USD5.75) today.

Editor: Kim Taylor