Simon FoyMon, 8 February 2021, 7:21 am
Boohoo has snapped up the remnants of Sir Philip Green’s collapsed Arcadia empire, buying Dorothy Perkins, Wallis and Burton for just £25m.
The online fashion giant said the deal would include all e-commerce and digital assets of the three brands, as well as their inventory. However, it does not include the brands’ 214 retail stores, concessions or franchises, putting thousands of jobs at risk as well as the brands’ high street futures.
Administrators at Deloitte said 260 employees across the brands will transfer to Boohoo, while Arcadia will provide “transitional services” including distribution and certain head office roles as part of the integration process.
The acquisition will be funded through Boohoo’s cash reserves and represents a changing of the high street guard as online disrupters assert their supremacy over beleaguered bricks-and-mortar rivals.
It comes after rival Asos bought the Topshop, Topman, Miss Selfridge and HIIT brands for £265m last week.
Boohoo chief executive John Lyttle said: “Acquiring these well-known brands in British fashion out of administration ensures their heritage is sustained, while our investment aims to transform them into brands that are fit for the current market environment.
“We have a successful track record of integrating British heritage fashion brands onto our proven multi-brand platform, and we are looking forward to bringing these brands on board.”
Boohoo recently acquired the Debenhams brand, but not its stores in a £55m deal. Some 10,000 staff are set to lose their jobs when Debenhams is relaunched as an online-only operation in March, bringing an end to the 243-year-old department chain’s 116 high street stores.
Boohoo chairman Mahmud Kamani said: “This is a great acquisition for the group as we extend our market share across a broader demographic, capitalising on growth opportunities as more and more customers shop online.
“We continue to grow our portfolio of brands and customer base, strengthening our position as a leader in global fashion e-commerce.”
Completion of the transaction is expected on Tuesday.
Administrators for Arcadia said: “In total, these sales together with other asset realisations, have raised proceeds to date of over £500m for the benefit of creditors. The process to generate proceeds from the Group’s remaining assets, principally from the Group’s property portfolio, is ongoing.”