Shareholders in collapsed fashion retailer Koovs – known as the ‘India’s ASOS’ – are reported to have threatened legal action to remove FRP Advisory as administrator for the apparel business over its sale.
Lawyers for four Koovs investors demanded an investigation into potential breaches of FRP Advisory’s duties in relation to a 3 million pounds that handed the company’s assets to founder and chair Lord Waheed Alli and wiped out their stakes, reported the ‘Financial Times’.
FRP “was involved at key stages in advising [Koovs] and its board” before it filed for administration and announced the deal to sell its assets to SGIK 3 Investments, lawyers at Locke Lord said in the letter to FRP administrators Geoff Rowley and Jason Baker.
It’s worth recalling that Koovs went public on London’s AIM market in 2014 with a value of 36 million pounds. However, the company never made a profit. Five years after floating, its shares were suspended, leaving the company’s valuation at around 12 million pounds. The same day the shares’ trading was suspended in December 2019, the retailer’s administrators were appointed and the business was sold to Alli’s company SGIK 3 Investments.
According to the financial journal, FRP said that “Throughout the administration process the joint administrators have fulfilled their statutory duties and acted in accordance with all relevant professional standards. In securing a sale of the business and assets of Koovs PLC, the joint administrators ensured the best outcome for creditors.”