al problems were within the company rather than external. From the outset, Alceon was using the old private-equity playbook that prescribes a five-year ownership to fatten the business for a handsome profit payday by attracting a buyer either on or off the Australian Securities Exchange. Like a number of previous private equity forays into Australian retailing, Alceon tried to reduce costs and limit investment in brand development while relying on an expansion strategy to do the fattening of the business. Alceon acquired Noni B in 2014 at what it no doubt thought was a bargain price of 51 cents a share, valuing the retailer at A$16.4 million, but Noni B’s best days were behind it. Noni B had struggled for sales growth from 2007 with earnings tumbling from A$8.2 million in 2006 to a A$7.8 million loss in 2014. Its lack of a compelling brand proposition was further weakened by the failure to launch two higher-end brands, Liz Jordan and La Voca. While the business had listed on the Australian Securities Exchange in 2000, Alceon regarded Noni B as characteristically more of a family business than a public company and therefore as a turnaround opportunity ripe for expansion, with some bolt-on acquisitions. Noni B appeared to fare better under Alceon and Scott Evans who was appointed as CEO following the on-market takeover, but its financial results were flattered by the 2017 acquisition of the Pretty Girl Group and the 2018 purchase of five retail chains from Specialty Fashion Group. In the 2016 financial year, the first under Alceon ownership, Noni B posted a modest A$2.2 million profit on sales of almost A$111 million, with the profit certainly an improvement on the previous year. Consolidated Press Holdings offloaded the 370-store Pretty Girl Fahsion Group’s labels, Rockmans, Table Eight, BeMe and W Lane in August 2016 in a cash and share deal which increased total revenue for FY17 to A$316.8 million and net earnings to a modest A$3.3 million. Noni B’s best year was FY18 when sales increased to A$372.4 million and net profits to A$17.3 million, reflecting synergy benefits from the previous year’s acquisition, but Alceon’s appetite for growth was not sated and in July 2018 Noni B acquired the five chains from the struggling Specialty Fashion Group. The effective A$31 million financial rescue of the Rivers, Millers, Katies, Autograph and Crossroads chains gave Noni B a footprint of around 1350 stores and increased annual sales to A$865 million and heady forecasts of A$1 billion-plus when fully integrated into the business. However, Millers, Katies, Autograph and Crossroads were unprofitable despite significant investment in upgrading their stores and merchandise ranges, restructuring supply chains and developing e-commerce sites and customer loyalty programs. Alceon moved quickly to secure synergy benefits but restructuring of its expanded retail business and under-performing stores reduced net earnings for FY19 to just A$8.2 million. In November 2019, Noni B changed its name to Mosaic Brands and a controlling stake in the New Zealand-based multi-channel retailer Ezybuy was secured. Then came the downward spiral, and the company was seriously exposed, with store performance problems and unresolved integration issues, as the Covid pandemic gouged sales and earnings across the 2020, 2023 and 2024 financial years. Covid was certainly a significant problem but Mosaic Brands was in strife because it had expanded too quickly, acquiring businesses that were struggling and well past their glory days. The brands lacked a unique selling proposition or compelling reason to buy. For the most part, they were tired and bland rather than enticing and inspiring. They were lacking appeal compared to competitors, missing the shift in fashion trends of their target demographic and, more importantly, they failed to move quickly enough to cut back the bloated store network. Mosaic Brands’ approach to integrating its businesses focused on taking costs out rather than rationalising the brands in its portfolio, which had ballooned to nine, and investing in brand development as well as shuttering unprofitable stores. All too late, Mosaic Brands’ CEO Erica Berchtold announced last September that the company would shut more than 200 stores and axe the Rockmans, Autograph, Crossroads, W Lane and BeMe brands. Berchtold said these five brands had become “marginal and non-core” but the decision was not enough to stave off the appointment of receivers and manager on October 28 last year. Berchtold was appointed as CEO of Mosaic Brands last February, officially taking over from Scott Evans who had headed the company for 10 years before resigning to become CEO of Alquemie Group which includes General Pants and Lego Certified Stores. In a LinkedIn post earlier this year, Berchtold wrote that she knew the business was in bad shape when she joined, though didn’t know “just how bad things were”. “I can assure you that this wasn’t because I didn’t do DD [due diligence],” she wrote. At the time of Berchtold’s appointment, Mosaic Brands chairman, Richard Facioni, claimed Evans had put the group back on its feet operationally, strategically and financially yet within months it was haemorrhaging and seeking safe harbour protection in August of last year. Mosaic Brands has debts of around A$318 million with the receivers not certain that all secured creditors will recover what is owed to them. KPMG, acting as receivers, was unable to find buyers for any of the stores but is continuing to pursue the possible sale of Mosaic Brands’ intellectual property and brand names. KPMG expects that all of the retailer’s stores will be closed by the middle of next month with a creditors meeting to follow in May or June. Mosaic Brands succeeded in becoming the biggest specialty fashion retailer in Australia but didn’t seem to have a business plan to match its ambitions. Being the biggest is not always the best or most profitable option, a lesson that might have been learned in FY18 before buying the financially stricken Specialty Fashion Group, which itself had had trouble digesting acquisitions.