Boohoo buys, Dorothy Perkins, Wallis and Burton for £25m
Boohoo has concluded a deal to buy the remaining Arcadia brands that hadn’t been take over by ASOS and City Chic. It’s paying £25.2 million to acquire “British heritage brands” Dorothy Perkins, Wallis and Burton out of administration.
It’s taking on “all of the e-commerce and digital assets and associated intellectual property rights, including customer data, related business information and inventory" of the brand trio, but not the stores. Like ASOS before it, the company made no mention of the physical shops nor the people who work in them. But it has emerged on Monday that 214 stores will now close with the loss of almost 2,500 jobs
It’s unclear if it will retain any staff from the three labels. ASOS had earlier said it was keeping around 300 staff as it bought Topshop, Topman, Miss Selfridge and HIIT. But ASOS is, like Arcadia, based in central London. Boohoo is Manchester-based so would be unlikely to want to run a small London satellite operation beyond an initial period.
The transaction completes as soon as Tuesday, “after which the relevant operations will continue as the group integrates them onto its platform in Q1 of the financial year that starts at the end of this month.
The company said this represents a “significant opportunity to grow Boohoo's market share across a broader demographic”.
While the brands may have struggled in recent periods, their new owner highlighted the fact that they had over two million active customers in 2020 and that their purchase “strengthens” its position as “a leader in the global fashion e-commerce market with over 15 brands across the group's scalable multi-brand platform,” as well as boosting its menswear offer.
It said “Burton is an established brand, which will enhance Boohoo's menswear portfolio in addition to boohooMAN and the recently acquired Maine and Mantaray brands”.
The additional own label brands will also support its new Debenhams marketplace.
In the most recent financial year to 29 August 2020, the brands generated unaudited revenues of around £427.8 million across all channels and an unaudited EBITDA loss of £14.3 million. With physical stores taken out of the mix, the ongoing businesses for the brands generated unaudited revenues of around £178.8 million over the same period.
CEO 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.”
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