Asos in talks to buy Topshop

Asos, the UK-based retailer that aims to become the world’s leading destination for fashion-loving 20-somethings, is in special talks with the management of Sir Arcadia Group Philip Green for the Topshop, Topman, Ms. Selfridge and HIIT Brands, the vendor confirmed Monday.

“Asos plc notes recent media profiteering and confirms that it is in specific discussions with Arcadia executives,” Asos said in a statement, adding, “The Board believes that this is a strong opportunity to get strong brands that respond well to the customer. bonn. However, at this stage, there can be no certainty about business and Asos will keep shareholders updated as appropriate. ”

The online and digital retailer noted that any build would be funded from investment.

Already a wholesale partner of Topshop and Topman, Asos has a big inside line. Nonetheless, news of the latter’s interest in both brands seemed to surprise sales viewers.

In 2002 Sir Philip bought the street group for £ 850 million, and three years later he paid one of the largest shares ever, £ 1.2 billion, to Arcadia’s registered owner, Lady Christina.

Cutting a colorful figure, Sir Philip was knighted in 2006 and advised David Cameron on everything from sales to public sector waste during the former prime minister’s time in office. He had a dramatic fall from grace when Arcadia moved into administration in 2012, selling a 25% stake in Topshop investment firm immediately to private equity firm Leonard Green & Partners, valuing the fashion chain at £ 2 billion. Bought it back for $ 1.

Arcadia executives at Deloitte last month sold Evans, the retailer’s best-selling fashion brand, to City Chic Australia for £ 23 million. On Friday, British multinational retailer Next with 700 stores, including 500 in the UK, pulled out of the race to buy Topshop and Topman, saying they were unable to meet price expectations. .

Both brands are seen as rewards on both sides of the lunch. A January 14 report published by GlobalData said JD Sports and Authentic Brands Group was at the forefront of buying Topshop out of administration.

“Topshop is the most profitable brand in Sir Philip Green’s old sales empire, but it requires significant investment and an updated strategy,” said Emily Salter, a sales analyst at Global Data. “JD Sports would have the best opportunity in partnership with Authentic Brands, which owns several American retailers, including Barneys.”

Asos in 2020 generated £ 3.17 billion in sales, a 19% increase over £ 2.7 billion in 2019. The platform, which saw 23.5 million hits in 2020, is renowned for its wide variety and inclusiveness. its styles, and had 22.2 million active customers in 2020.

The company emphasizes loneliness and choice, with the purpose of encouraging their customers to be whatever they want to be. Asos knowledge and mobile / desktop web experience, available in 10 languages ​​in over 200 markets, offers 85,000 products from 850 brands.

In addition to Topshop, Topman, Miss Selfridge and HIIT, Asos housebags include ASOS Design, ASOS 4504, and the Venture Brands, Collusion and AsYou.

It has been speculated that, with the single focus on e-commerce and digital commerce, Asos may not be likely to continue operating Topshop and Topman’s brick-and-mortar stores.

A spokesman from Asos declined to comment on the matter. However, a sales source said the company will most likely not change their approach to sales or change their business model if the deal comes to fruition.

The company has 168 Topshop stores and 94 franchises in more than 24 countries, including the 100,000-square-foot global flagship on London’s Oxford Street. Approximately 13,000 sales operations are said to be at risk. The exact number would depend on the eventual buyer and whether another party comes forward to capture Arcadia’s smallest labels such as Wallis and Outfit.

Topshop.com attracts more than 3 million weekly visits over mobile, the Topshop app and the desktop, and goes to more than 100 countries with unique trading platforms in several languages, according to the her website. In addition to Asos, the retailer’s wholesale partners include Nordstrom and Zalando.

Asos in 2018 unveiled for the first time in New York the autumn / winter 2018 men’s wear collection. Nick Eley, head of design for men’s closures, told me at the time, “Because the such a diverse purchase at Asos, the designs range from subtle to full-on. The collection connects modernity and history with a range of future pieces and styles thrown back from the West. ”

Instead of using traditional models, Asos throws fans of the brand who “still inspires us with the talent and passion across a number of industries, including fashion, food, music, and more. social activity, ”said Eley.

The retail source said that both Asos and Topshop have the potential to grow significantly in the U.S., noting that if the deal were to go ahead, Asos would be entitled to sell to other retailers .

Although the terms of the contract were not published, it was widely reported that they would be between £ 250 million and £ 300 million, with the retail source taking the node to the higher end of the spectrum, if the agreement were upheld.

“Asos is very much aimed at 20-something fashion-oriented people, but it’s more interesting than real age,” the source said. “Some older people will buy it, and some younger people will too. Child wear is not high on Asos’ list of extension categories, but could be considered for classification as swimwear. ”

Asos aims to provide customers with a seamless experience, with a growing number of payment options and hundreds of local delivery and return options, including next day delivery, and on-time delivery. one day, shipped from state-of-the-art performance centers in the UK, Germany and the US

Earlier this month, Asos announced it would invest £ 90 million in a state-of-the-art performance center in Lichfield, Staffordshire, England, with a plan to employ 2,000 people at the site over the next three years. ahead, in addition to the 7,000 people directly employed by the retailer across the UK