Things are moving on the British fashion market. Online fashion platform Boohoo is taking over Debenhams but is leaving the stores for what they are. In the meantime, Asos is ogling Arcadia.
"Becoming the UK's biggest marketplace"
Boohoo Group is putting 55 million pounds (62 million euros) on the table for Debenhams. The deal includes the brand name together with internal brands, intellectual property and customer lists. The outlets of the bankrupt department store chain are not part of the deal.
The deal is expected to help expand Boohoo's reach beyond youth fashion, reports the Financial Times. Boohoo said it planned to "rebuild and relaunch the Debenhams platform" and create " the UK's largest marketplace for fashion, beauty, sport and homewares".
Meanwhile, Asos has entered into exclusive negotiations with Arcadia on the acquisition of a number of brands including the main Topshop and Topman franchises. The British fashion group went bust in November last year, partly as a result of the Covid-19 crisis. But the problems have been dragging on for much longer. Asos believes the brands would be a good addition to its existing portfolio. At the same time, the company warned that there was no certainty of a deal.
Even higher vacancy rates?
Boohoo and Asos have been able to benefit from the Covid-19 pandemic over the past year, gaining market share from competitors who were forced to close their doors during repeated lockdowns in the UK. Their shorter and more flexible supply chains also allowed them to move more quickly from formalwear to leisure items such as joggers, hoodies and leggings - garments that were suddenly made popular by the crisis.
Neither Asos nor Boohoo wants to operate brick-and-mortar stores, which means that the remaining 118 Debenhams department stores and the more than 400 Arcadia branches may close for good. It also means that the already vast problem of rising vacancy rates in British town centres will only worsen.