The encyclopedia · Sales & Retail · Strategic decision · 2006–2019
Links of London collapsed in 2019 after its owner's accounting scandal cut it off
Bought by Folli Follie for €45M in 2006, the jeweller lost £20.5M on £42.9M of sales in 2017. When its owner was caught inflating revenue, no buyer came.
Links of London · Folli Follie · 2019-10-08
What happened
Links of London was founded in 1990 by John Ayton and Annoushka Ducas, and became known for its cufflinks, charms and gold and silver jewellery. In 2006 the founders sold 100 percent of the company to the Greek luxury group Folli Follie for about €45 million. Backed by its new owner, the brand grew to more than 330 stores worldwide.
The business never recovered the momentum of its early years. By 2017 it was making a pretax loss of £20.5 million on revenue of £42.9 million. Directors blamed difficult trading conditions across UK retail and ongoing cash-flow pressures, as luxury jewellery sales moved online and footfall fell on the high street.
Then its owner became the story. Folli Follie was caught overstating its 2017 revenue by more than €1 billion, with Asian sales inflated by 90 percent, and Greece's securities regulator fined the company and its executives €20.3 million. A parent fighting for its own survival could not fund a turnaround. Directors explored a CVA, refinancing or a sale, but ran out of time. On 8 October 2019 Links of London entered administration; Deloitte was appointed, up to 350 jobs were put at risk, and all 28 UK and Ireland stores and seven concessions closed.
Why it happened
- A physical-heavy store and concession network left the brand exposed as luxury jewellery sales moved online and UK high-street footfall declined
- The 2006 sale tied the brand's fate to a single owner; when Folli Follie needed cash for itself, the subsidiary had no independent backer to turn to
- Folli Follie's accounting fraud — over €1 billion of overstated revenue and a €20.3 million fine — consumed its management and capital at the worst moment
- A £20.5 million loss on £42.9 million of sales in 2017 showed a cost base that no longer matched the revenue the brand could command
The lesson
An acquired brand is only as safe as its owner. When the parent is in crisis, heritage and a full order book will not raise a buyer in time — the subsidiary needs a backer of its own.
Aftermath
Deloitte closed all 28 standalone stores and seven concessions across the UK and Ireland, putting up to 350 jobs at risk. No buyer was found for the business as a going concern. The collapse came in the middle of the wider 2019 UK high-street crisis, alongside the failure of other household retail names that year.
Sources
- The Guardian: Links of London jewellery chain goes into administration
- FashionUnited: Links of London sold to Folli Follie
- BBC: Links of London — jobs at risk as firm goes into administration
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