(qlmbusinessnews.com via news.sky.com– Mon, 8th Feb 2021) London, Uk – –
Administrators confirm most staff are to lose their jobs as Arcadia's brands are sold off to face an online-only future.
Boohoo is to pay £25.2m for Dorothy Perkins, Wallis and Burton in a deal set to catapult the fashion brands to an online-only future and result in 2,450 job losses.
The online fashion specialist, which has already snapped up the Debenhams name amid the COVID-19 bloodbath for physical retailers, said it was to buy all the e-commerce and digital assets of the three brands, as well as their stock.
It confirmed that the deal with administrators at Deloitte did not include the brands' retail stores, concessions or franchises.
The collapse of Sir Philip Green's Arcadia empire in December placed 13,000 jobs at risk and only a tiny fraction of 2,500 workers were understood to be saved when Boohoo rival ASOS landed the top names, including TopShop and Miss Selfridge, a week ago.
Administrators confirmed only 260 jobs were to transfer to Boohoo under Monday's deal and all 214 Burton, Dorothy Perkins and Wallis stores – already shuttered by pandemic restrictions – are to be permanently closed down.
They said the staff had been informed via email.
It leaves around 12,400 of Arcadia's 13,000 workers on track to lose their jobs by the time the administration process has been completed.
Deloitte's statement said: “This transaction completes the sale of the Arcadia brands and follows the sale of Topshop, Topman, Miss Selfridge and HIIT to ASOS plc on 4 February 2021 and the sale of Evans to City Chic on 23 December 2020.Retail jobs worst hit by coronavirus pandemic
“In total, these sales together with other asset realisations, have raised proceeds to date of over £500m for the benefit of creditors.
“The process to generate proceeds from the group's remaining assets, principally from the group's property portfolio, is ongoing.”
Boohoo shares, up by 6% in the year to date, fell by 3% in early deals. Traders said the drop could be explained by reports over the weekend that pure online retailers could face a digital sales tax.
“Acquiring these well known brands in British fashion 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.”
By James Sillars