British fashion group Arcadia, mainly known from the brand Topshop, is bankrupt. The corona crisis turned out to be the final blow for the retailer. The bankruptcy could also have far-reaching consequences for Debenhams.
Arcadia was in bad shape even before the crisis. Last year, the fashion group announced a major restructuring. But with the outbreak of the coronavirus and the compulsory store closures, the problems have become worse. Yesterday evening, the company which owns brands including Topshop, Dorothy Perkins and Burton is now under the legal restraint of Deloitte, who is looking for a buyer.
Arcadia has over 440 stores in the UK and 22 overseas. It employs around 13 thousand people. Over 9 thousand of them have been put on furlough. No redundancies have yet been announced. The stores and webshops will remain open until further notice, reports FashionUnited.
Who is showing interest?
Frasers Group, owned by the disputed businessman Mike Ashley, has already expressed interest in Arcadia's trademarks. Ashley even wanted to grant an emergency loan of fifty million pounds (56 million euros) to the fashion group, but according to Frasers Group, that proposal got rejected. In the meantime, Boohoo Group, a fast-fashion e-commerce player that built its success mainly on acquiring smaller or failing companies, also came up as a potential buyer for some of Arcadia's brands.
The collapse of the fashion company also bears bad news for Debenhams. The BBC reported today that JD Sports halted negotiations on a possible takeover of the ailing department store chain. The bankruptcy of Arcadia would have played a crucial role in that decision, as the retail giant is also Debenhams' largest concessionaire. Arcadia's brands, such as Miss Selfridge and Dorothy Perkins, are being sold at Debenhams. They account for a turnover of approximately 75 million pounds (84 million euros).