The online fashion retailer Asos is the new owner of Topshop and other leading brands from Sir Philip Green’s Arcadia empire after a £330m deal that puts thousands of jobs at risk.
The deal also includes Topman, Miss Selfridge and the activewear brand HIIT, which were put up for sale after Arcadia collapsed into administration last year.
Asos, which only operates online, has not agreed to buy any of the brands’ 70 stores, putting at risk the jobs of 2,500 high-street shop workers. It is understood an additional 50 stores have permanently shut since administrators were appointed in November. Warehouse and head office jobs are also at risk.
Only 300 head office staff will be saved as part of the Asos deal, to help with design, buying and retail partnerships.
An administrators’ report seen by the Guardian last week showed that Topshop and Topman alone employ about 4,792 staff. Arcadia Group as a whole employed 13,000 staff and had 500 stores across the UK when it entered administration in November.
Asos paid £330m in total, including £265m for the brands and £65m for current and future stock.
The deal does not include any of Arcadia’s warehouses or its distribution centre in Daventry. The Asos chief executive, Nick Beighton, said the company already had its own “well-funded and built out warehouse strategy” and the Daventry site was not purpose-built to handle online shopping orders.
Administrators at Deloitte have asked Asos to consider keeping open Topshop’s flagship Oxford Street store, though Beighton said he would only be interested in a third-party partnership, rather than adopting the lease or buying the site entirely.
“It’s not our core model to take stores, nor our core strategy, but never say never. So, since we were presented with opportunity we said we’d have a look, but it’s not our number one priority or focus right now,” he said.
The online retailer, which confirmed last week it was in exclusive negotiations with Arcadia’s administrators after the Guardian first revealed the talks, will complete the takeover by Thursday.
The changeover is expected to take place on Wednesday night, with customers likely to be greeted with a webpage redirecting them to the Asos site, which will start incorporating the new brands into its own online platform.
Beighton said he was “extremely proud” of the deal. “The acquisition of these iconic British brands is a hugely exciting moment for Asos and our customers and will help accelerate our multibrand platform strategy,” he said.
“We have been central to driving their recent growth online and, under our ownership, we will develop them further, using our design, marketing, technology and logistics expertise, and working closely with key strategic retail partners in the UK and around the world.”
The deal sent Asos shares up nearly 7% on Monday.
A report by the administrators Deloitte, seen by the Guardian, suggested Green’s family was likely to receive £50m from the sale, relating to an interest-free loan it made to the group in 2019 at the time of an emergency restructure. However, more than 1,000 suppliers and landlords to the high-street fashion chain will get less than 1% of the money owed to them.
Meanwhile, affected workers commented on Twitter, with one saying they had worked for Topshop for two years but that their manager only heard their jobs were at risk through news reports on Monday. “It’s actually disgusting … the administrators didn’t inform us, the press/social media knew before we did. Disappointed isn’t the word today,” they said.
It’s actually disgusting. I’ve worked for Topshop for 2 years & my own manager found out through Sky News as the Administrators didn’t inform us, the press/social media knew before we did. Disappointed isn’t the word today.
— Beccy (@Billies_Wife) February 1, 2021
Asos is believed to have beaten other potential bidders including the Chinese fashion retailer Shein, Authentic Brands, the US owner of the Barneys department store – which was linked to a joint bid with JD Sports – and the billionaire Issa brothers, who in October announced they were buying Asda for £6.8bn.
Online group Boohoo confirmed last week it had entered into exclusive talks to buy the final three Arcadia brands: Wallis, Dorothy Perkins and Burton. Evans, its plus-size clothing brand, was sold to the Australian retailer City Chic Collective for £23m in December.
