ONLINE FASHION RETAILER Boohoo has bought the Debenhams brand and website for £55 million (€62 million) in a deal that will see the eponymous department store name survive, but the company’s remaining 118 stores in the UK close for good.
The deal will see Debenhams products sold by Boohoo from early next year, allowing enough time for liquidators to continue closing the retailer’s sites once they are allowed to reopen after Covid-19 lockdown restrictions are lifted.
But with stores closing across the 242-year-old brand, it is unlikely many of the remaining 12,000 jobs are likely to be saved.
The deal is unlikely to affect Debenhams in Ireland, which operated under a separate company than the UK brand and closed all of its Irish stores in April last year with the loss of about 1,000 jobs.
Former Irish staff with the company have been protesting since the closure of the stores last year about their redundancy payments.
In the UK, Debenhams had already announced significant job losses and the permanent closure of six stores, including its flagship outlet on London’s Oxford Street.
Boohoo said the deal represents a “fantastic opportunity” to target new customers and launch into the beauty, sports and homewares market for the first time.
The company highlighted how Debenhams has six million beauty shoppers and 1.4 million Beauty Club members.
It said: “The group intends to rebuild and relaunch the Debenhams platform, helping further the group’s stated ambition to lead the fashion eCommerce market, and grow into new categories including beauty, sport and homeware.”
In hints that it intends to take on the might of Amazon, Boohoo said it would create the UK’s largest marketplace across fashion, beauty, sport and homeware – expanding the range of products sold via Debenhams marketplace by maintaining current third party relationships and expanding further.
Debenhams’ own fashion brands will also be absorbed into Boohoo’s current portfolio and sold via the Debenhams website.
Boohoo chief executive John Lyttle said: “The acquisition of the Debenhams brand is an important development for the group, as we seek to capture incremental growth opportunities arising from the accelerating shift to online retail.”
Founder and executive chairman, Mahmud Kamani, added: “Our acquisition of the Debenhams brand is strategically significant as it represents a huge step which accelerates our ambition to be a leader, not just in fashion eCommerce, but in new categories including beauty, sport and homeware.”
Boohoo has previously bought a number of well-known high street brands out of administration, turning them into online-only operations, including Oasis, Coast and Karen Millen.
Topshop
In a separate but similar move, online fashion giant Asos has confirmed it is in exclusive talks with administrators for Philip Green’s Arcadia retail empire.
The company said the ongoing discussions are about snapping up Arcadia’s brands including Topshop, Topman, Miss Selfridge and HIIT, sold via Burtons.
Asos said in a short statement to the London Stock Exchange: “The board believes this would represent a compelling opportunity to acquire strong brands that resonate well with its customer base.
“However, at this stage, there can be no certainty of a transaction and Asos will keep shareholders updated as appropriate. Any acquisition would be funded from cash reserves.”
- With reporting by Rónán Duffy
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