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Forever New (Australia) Fashions Itself as Global Retailer

08 Sep 2011 - Winding himself in rope, his muscles taut, the man held himself suspended above the stage - a sudden release sending him rolling smoothly down to a stop a few metres above the stage. His performance - and that of a female trapeze artist - was part of the elaborate spring season launch held last month by fast-fashion chain Forever New, which was showing its new line of frothy frocks aimed at teenage girls. But away from the circus acts, something just as complex and ambitious has been unfolding.

While the unwillingness of Australian shoppers to open their purses has sent other fashion chains to the wall, the privately held Forever New is gearing up to turn itself into a global retail force. The company, headed by Dipendra and Amanda Goenka, has undergone an elaborate restructure involving companies and trusts in four countries that values it at about $108 million. "Forever New is evolving from an Australian company with exposure in overseas markets to a global retailer with Australian headquarters,'' a company spokeswoman said. ''The company was restructured in 2010 to support this growth, although the ownership remains unchanged.'' While Forever New is best known as an Australian retailer, the 120-store chain already includes outlets in China, India, New Zealand, Singapore, South Africa and Turkey.

''We are in talks for new countries in 2012 [and will make] announcements later in the year,'' the spokeswoman said. The Goenkas are the public face of the company, backed by British retail magnate Tom Singh, who invested in Forever New soon after the couple set up shop in 2006. Mr Singh founded Britain's second-largest womenswear retailer, New Look, in 1969. ''Tom Singh continues in his advisory role with the investment via independent trusts run on behalf of the Singh family," Forever New's spokeswoman said.

In last year's restructure, ADT Group Holdings (ADT), a new company owned by the Goenkas and Mr Singh, paid $108.2 million to buy the clothing chain from Winning Dragon, a Hong Kong-registered company. Half of Winning Dragon belongs to another Hong Kong company, Well Sunny Enterprises, which in turn is owned by Guernsey-registered Lesing Ten. The other half of Winning Dragon belongs to British Virgin Islands-based Joystar Development. After the payment was made, Winning Dragon forgave $74.8 million of debt it was owed by Forever New in return for new shares. The net result appears to be a flow of $33.4 million from ADT to Winning Dragon. ADT has both ordinary and D-class shares on issue, with half of each type belonging to the Goenkas through two Australian companies.

Lesing Ten holds the other half of the D-class shares while Lesing Nominees, also registered in Guernsey, holds the other half of the ordinary shares. While Guernsey company documents do not show who owns the two Lesing companies, they appear to be the vehicle through which Mr Singh has made his investment in Forever New. The head of Guernsey-based financial services company Praxis Fiduciaries, Robert Fearis, is a director of both companies. He did not respond to BusinessDay's email. While Forever New's restructure means it is impossible to say how much the chain made last year, accounts filed with the Australian Securities and Investments Commission show that between June 25 and July 31 last year it cleared $480,000 profit on about $1.9 million worth of sales. It had assets of almost $50 million and employed about 700 people, the accounts show.
Business Day

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