As it files for bankruptcy in the United States, a global luxury lifestyle brand is immediately closing its American stores.
Due to an overly ambitious expansion plan in the United States, the high-end furniture retailer Oka has closed its Dallas, Houston, and Westport, Connecticut, locations.
British Nobility
Viscountess Annabel Astor, a member of the British nobility and the mother of Samantha Cameron, the UK’s former first lady, established the business.
It began operations in the United States in 2019 after 20 successful years in the UK.
Ceasing Operations
However, financial difficulties have prompted the decision to cease operations in the United States and to restructure in the United Kingdom, where it hopes to continue trading.
A statement on the OKA US website states, “As a result of the Chapter 7 filing, we have ceased all business operations in the US effective immediately.”
US Closure
The statement continued: “As a result, we are no longer accepting new orders via our US stores or website at this time.”
The company hopes to survive in its home country of the United Kingdom by filing for a Company Voluntary Agreement—a type of Chapter 11 bankruptcy—while operations in the United States have been suspended.
Layoffs
One of Oka’s 13 UK locations would be closed and up to 250 employees would be laid off if the deal is approved.
According to Business of Home, the move would have an effect on a head office and a distribution center.
Lifestyle Brand
Oka is a lifestyle brand that has previously collaborated on advertising campaigns with The Crown actress Erin Doherty.
It sold armchairs for $2,000, lamps for $900, and candelabras for $220.
Business Origins
Astor started the business with her sister-in-law Sue Jones, a designer, and Lucinda Waterhouse, a skilled horticulturist.
Due to disagreements with the company’s new owners regarding their rapid expansion in the United States, Astor resigned from the board in May of this year.
Invest Industrial
Lady Astor, 75, disagrees with Invest Industrial, the owner of OKA, which she sold in 2018 for approximately $51 million.
Aston Martin is one of the major brands in Invest Industrial’s portfolio.
Astor’s Involvement
Up until the beginning of this year, Astor remained a non-executive director on the board.
After the owners turned down her proposal to lead a management buyout, she made the decision to leave.
Financial Difficulties
The cost of the deal, which she says would have been supported by family finances, was not unveiled.
The company’s US division has been struggling ever since it spent too much money purchasing the furniture and interior brand Wisteria in 2019.
Loan Support
The company took out a $11.5 million loan in 2021 to stop its losses from spiraling out of control.
Astor said that she was “sad” to leave but had an idea for a new business after she left.
UK Success
According to Astor, the UK side of operations is continuing to thrive with sales for 2022 totaling $53 million.
With adjusted profits, 2022 saw a net of $8 million with Astor stating that she was “offering a good deal” at the time.
The impact of the rapid expansion may have long-term effects on the company as it strives to remain a competitor in the UK.
