Shareholders of Nasdaq-listed Naked Brand Group have approved the divestment of Auckland-based lingerie chain Bendon to a group of existing management.
Proxy votes were cast in favour of the deal at Naked's annual shareholders' meeting in Sydney, despite most shareholders residing in the US.
A preliminary vote tally showed 114.1 million shares were voted in favour of the deal and 1.97 million against, according to a US SEC filing.
The deal will see Naked chair and CEO Justin Davis-Rice and Bendon chief executive Anna Johnson buy Bendon for a token $1 with Naked forgiving a $40m intercompany loan, while extending a $7m loan to maintain inventory and product design.
Naked announced plans earlier this year to restructure and dispose of its unprofitable bricks-and-mortar operations and focus exclusively on its e-commerce business.
Independent directors, Simon Tripp, Andrew Shape and Kelvin Fitzalan had formed a committee that considered it was "not in the best interests of shareholders to continue progressing and funding the Bendon business".
The alternative to the management buyout was to exit the Bendon business through a liquidation, although that was less likely after Naked raised capital after a Reddit-fuelled short squeeze in January pushed the stock 700 per cent higher to US$1.65 a share. The stock has since fallen back to around US75c.
Since Naked listed in 2017 and acquired Bendon from Eric Watson's Cullen Investments, Bendon itself has accumulated operating losses of more than US$56m ($78.4m).
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Despite investing in a turnaround plan from December 2018, the Bendon Group has incurred $78.9m of net losses before tax over the three-year period ending January 31 this year.
The majority of Bendon's retail stores are in New Zealand, with most of its revenue generated here. In Australia it also sells product exclusively through department store David Jones and online sites.
Last year Naked terminated a licence agreement with Heidi Klum branded products having previously jettisoned the Stella McCartney brand and is now focused on Pleasure State, Fayreform and Frederick's of Hollywood.