Frasers Group Sports Direct owner buys Missguided fashion retailer after collapse

Sports Direct owner Frasers Group has bought Missguided for £20m, after the online fashion retailer collapsed into administration.

Chief executive Michael Murray said the group, which also owns House of Fraser, was “delighted to secure a long-term future” for the fast fashion company.

It has suffered from supply chain problems, rising freight costs and increasing competition from rivals.

Suppliers had accused the business of leaving millions of pounds of debts unpaid.

Frasers Group confirmed it had bought the intellectual property of Missguided and its sister brand Mennace, which it said would be operated by administrators for a transition period of around eight weeks.

It said it then intended to run Missguided as a “standalone business” within the group.

Mr Murray said: “Missguided's digital-first approach to the latest trends in women's fashion will bring additional expertise to the wider Frasers Group.”

The Manchester-based business was founded by Nitin Passi in 2009 and grew to become one of the UK's biggest online fashion players. But in the last few years it has struggled to make a profit.

Last autumn it was rescued by the finance firm Alteri Investors, with Mr Passi stepping down as chief executive in April.

Prof Dilys Williams, director of the centre for sustainable fashion at London College of Fashion, said the company's collapse exposed the “fragility” of the fast fashion model.

She said many customers were becoming more interested in sustainability and moving away from cheap, throwaway clothing.

Missguided once had a lucrative sponsorship deal with reality dating show Love Island but this year the series has partnered with eBay to style the stars in second-hand pieces.

“The culture of being able to buy second hand and it being a great thing is a change in how people are thinking about fashion,” Prof Williams told the BBC.

However, the brand had also faced increased competition from fast fashion rivals such as Boohoo and Shein, a Chinese company which saw its popularity surge during the pandemic.

The Frasers Group deal comes as it embarks on a modernisation strategy under a new boss, with plans to open up to 10 flagship Sports Direct stores across the UK.

Mr Murray took over from founder Mike Ashley – his future father-in-law – in May.

Missguided will become the latest troubled brand to join the group, after it snapped up Game, Evans Cycles, Jack Wills and Sofa.com in similar deals.