MONTREAL – Lingerie and swimwear retailer Boutique La Vie en Rose plans to expand Bikini Village stores across Canada and abroad after reaching an agreement to buy the insolvent bathing suit chain.
“Bikini is a strong name and we’re going to build a national chain with that division,” said La Vie en Rose CEO Francois Roberge, who added he paid less than $4 million for the company which he previously tried three times to buy over the past 12 years.
About 300 jobs will be preserved, but half of the 50 head office jobs will be lost as it merges the headquarters of the two companies.
La Vie en Rose plans to keep 48 of Bikini Village’s stores in Quebec, Ontario, New Brunswick and Nova Scotia, but will close four outlet locations in Quebec.
After stabilizing the business, the new owners plan to work on adjusting the merchandising at the retailer in time for the fall cruise season.
The changes are designed to restore annual sales to about $50 million from the current level of $34 million.
It will then focus on a Canadian expansion, especially in Western Canada, increasing the number of stores to about 70 to 75 over the next year to 18 months.
La Vie en Rose also plans to expand the Bikini Village brand internationally in about two years.
“If we can make money here (Canada) we can make money anywhere,” he said referring to the challenges of a short summer season.
The purchase is subject to approval by a Quebec Superior Court judge. Groupe Bikini Village (TSXV:GBV) filed for creditor protection last month under the Bankruptcy and Insolvency Act after posting a series of million-dollar quarterly losses.
Bikini Village chairman Jocelyn Dumas said it found a strategic buyer in La Vie en Rose.
“There’s a good fit. We’re very happy that many of the jobs will be saved and the brand will continue to live.”
Maintaining the Bikini Village brand is a rare survival story for Canada’s battered retail sector in recent months with the closure of Mexx, Boutique Jacob, Target, Smart Set and the bankruptcy filing of Parasuco Retail, said retail consultant Terry Henderson of the J.C. Williams Group.
He said the combination with an existing swimwear retailer makes sense because La Vie en Rose can streamline Bikini Village’s back office operations and use its buying power and merchandising expertise.
La Vie en Rose has nearly 180 stores across Canada operating under three banners — La Vie en Rose, La Vie en Rose Aqua, and La Vie en Rose Outlet — as well as more than 75 stores outside of Canada in more than 14 countries.