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| Revolution Beauty's founders return as sale falls through | Revolution Beauty's founders return as sale falls through |
| (about 3 hours later) | |
| Revolution Beauty is known for its work with influencers and Love Island stars | Revolution Beauty is known for its work with influencers and Love Island stars |
| Troubled fashion brand Revolution Beauty has brought back its former bosses to "reset" the business after failing to secure a buyer. | Troubled fashion brand Revolution Beauty has brought back its former bosses to "reset" the business after failing to secure a buyer. |
| Co-founders Adam Minto and Tom Allsworth resigned following a series of accounting issues, but on Friday the company said the pair will return to tackle its plummeting sales. | Co-founders Adam Minto and Tom Allsworth resigned following a series of accounting issues, but on Friday the company said the pair will return to tackle its plummeting sales. |
| Revolution, which sells make-up and cosmetics online and through concessions, said it had not received any suitable offers since launching a sale process earlier this year and, as a result, it was no longer looking for a buyer. | Revolution, which sells make-up and cosmetics online and through concessions, said it had not received any suitable offers since launching a sale process earlier this year and, as a result, it was no longer looking for a buyer. |
| Frasers Group, owned by businessman Mike Ashley, said it did not plan on making an offer after previously exploring a possible bid. | Frasers Group, owned by businessman Mike Ashley, said it did not plan on making an offer after previously exploring a possible bid. |
| Frasers Group owns a stake in Boohoo which, in turn, owns a stake in Revolution Beauty - meaning Frasers Group already owns a small chunk of Revolution Beauty. | |
| As part of its attempt to turn the low cost make-up firm around, Revolution Beauty said it would look to raise about £15m by issuing new shares. | As part of its attempt to turn the low cost make-up firm around, Revolution Beauty said it would look to raise about £15m by issuing new shares. |
| The cosmetics company reportedly rejected a takeover bid from specialist private equity firm True earlier this month. | The cosmetics company reportedly rejected a takeover bid from specialist private equity firm True earlier this month. |
| Chairman Iain McDonald said it was "a great brand, but the business has lost its way". | Chairman Iain McDonald said it was "a great brand, but the business has lost its way". |
| Adam Minto (L) and Tom Allsworth (R) founded Revolution Beauty more than 10 years ago | |
| While Revolution Beauty sells its products through retailers such as Superdrug and Boots and online fashion websites including ASOS, it also has a strong presence on social media and worked with influencers and Love Island contestants in the past. | |
| Retail analyst Jonathan De Mello said the brand was "in vogue" a few years ago but increased competition and rising costs, with consumers on tight budgets, meant its popularity waned. | |
| However, a turnaround of the business would also require reigniting celebrity endorsements and collaborations to "win those consumers back", he said. | |
| Mr Allsworth will return as the company's chief executive, while Mr Minto will take on a consultancy role with a £160,000 per year salary. | Mr Allsworth will return as the company's chief executive, while Mr Minto will take on a consultancy role with a £160,000 per year salary. |
| The co-founders will be carrying out a "new and refreshed strategy for Revolution Beauty, with a view to returning it to long-term profitability", the firm said. | The co-founders will be carrying out a "new and refreshed strategy for Revolution Beauty, with a view to returning it to long-term profitability", the firm said. |
| Further cost savings are expected, which will include cutting staff to free up an extra £7.5m by 2027. | Further cost savings are expected, which will include cutting staff to free up an extra £7.5m by 2027. |
| Mr Minto quit as chief executive in 2022 after accounting issues delayed Revolution's 2022 results and its shares were suspended. | Mr Minto quit as chief executive in 2022 after accounting issues delayed Revolution's 2022 results and its shares were suspended. |
| There were also allegations Mr Minto and Mr Allsworth had made personal loans to an employee and to distributors, which were not disclosed to the board. | There were also allegations Mr Minto and Mr Allsworth had made personal loans to an employee and to distributors, which were not disclosed to the board. |
| Mr Minto agreed to pay Revolution nearly £3m to settle the issues. | Mr Minto agreed to pay Revolution nearly £3m to settle the issues. |
| News of the pair returning to the company was "a bit of a surprise", said Mr De Mello. | |
| "They are the people that essentially scaled up the business and made it the success it was." | |
| "They have a track record of building the brand." | |
| On Friday, the company revealed a 25.5% drop in sales over the last financial year, with revenues totalling £142.6m in the 12 months to 28 February. | On Friday, the company revealed a 25.5% drop in sales over the last financial year, with revenues totalling £142.6m in the 12 months to 28 February. |
| It also reported a pre-tax loss of £16.8m from an £11.4m profit the previous year. | It also reported a pre-tax loss of £16.8m from an £11.4m profit the previous year. |
| Mr McDonald said: "We are confident that with a return to the founder-led management team who originally scaled the brand, there is a clear path back to growth and long-term value creation." | Mr McDonald said: "We are confident that with a return to the founder-led management team who originally scaled the brand, there is a clear path back to growth and long-term value creation." |
| Revolution Beauty's share price rose 10.4% following the announcement. | Revolution Beauty's share price rose 10.4% following the announcement. |