LONDON – Boohoo has bought the last batch of Arcadia’s high-street brands – Dorothy Perkins, Wallis and Burton – in a deal that marks the end of an era for Sir Philip Green’s once-mighty, and now bankrupt, British retail group.
Boohoo, which had been in exclusive talks to buy the three names from Arcadia, is paying 25.2 million pounds in cash for the e-commerce and digital assets, intellectual property rights, customer data, and inventory of the three brands.
The purchase comes a week after Asos bought Topshop, Miss Selfridge and other brands from Arcadia Group, which declared bankruptcy last November, for 330 million pounds.
The Boohoo transaction excludes the store network which comprised 214 physical sites. Those stores will shut, according to Deloitte, which has been handling the Arcadia bankruptcy.
Deloitte added that approximately 260 employees across the three brands, including design, buying, merchandising and digital staff, will transfer to Boohoo.
Boohoo is on a buying streak: A few weeks ago it purchased the Debenhams brand, but not the stores, as part of a bid to build a multi-brand retail brand platform, a virtual high street of sorts, to rival those of Next and Asos.
Dorothy Perkins and Wallis are both mass market women’s fashion brands, while Burton sells men’s wear.
All three brands will allow Boohoo, an ecommerce powerhouse aimed at Gen Z, to appeal to an older, broader demographic. The platform now offers 15 brands including Karen Millen, Oasis and Warehouse, which it also bought out of administration.
Boohoo said it bought the three Arcadia brands for a number of reasons: They had two million active customers in 2020; they’ll help to strengthen Boohoo’s men’s wear offer and its position in the global fashion e-commerce market.
Dorothy Perkins, Wallis and Burton will also help to bulk up the Debenhams multi-brand online marketplace that Boohoo is building.
John Lyttle, Boohoo’s chief executive officer, said Monday that buying the brands 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 said the transaction would be financed through the group’s existing cash resources, which stood at 386.9 million pounds on Dec. 31, 2020, prior to the acquisition of Debenhams for 55 million pounds last month.
In the most recent financial year to Aug. 29, 2020, the three Arcadia brands generated unaudited revenues of approximately 427.8 million pounds across all channels and an unaudited EBITDA loss of 14.3 million pounds.
Deloitte has finished parcelling off Arcadia (it sold plus-size brand Evans to City Chic in late December) and said the sales raised total proceeds of more than 500 million pounds for creditors.
The company said the process to generate money from the group’s remaining assets, principally from the group’s property portfolio, is ongoing.
After dominating high streets across Britain for decades the Arcadia brands fell on hard times as its owner Green was slow to pivot to digital sales and had a vast physical store estate, which proved increasingly expensive to run.
But in its heyday, the group and its jewel, Topshop, were forces in the fashion world.
Green was quick to understand the power of supporting young talent and making friends with celebrities.
He brokered deals between Topshop and the likes of Kate Moss, Beyoncé, Kendall Jenner and Kylie Jenner for clothing, lingerie and makeup while the store actively scouted and supported young talents including Jonathan Anderson, Mary Katrantzou, Jonathan Saunders and Christopher Kane.
Topshop and its brother company Topman were headline sponsors of London Fashion Week, bankrolling their own venues during shows. As recently as three years ago, Topshop was hosting shows for designers including Preen by Thornton Bregazzi, Nicopanda, Shrimps, Molly Goddard and Charlotte Knowles.
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