New info on who’s leading the race to take over Topshop / Topman – this time, Asos is running as the favorite. The news reaches us a week after Next was announced as a possible winner and days later it left the race claiming too high a price.
Sky News announced on Saturday that Asos was taking the lead after the abandonment of Next, although other sources also cited China’s Shein as the main candidate. It is also said that she would be interested in the acquisition of Miss Selfridge, of Arcadia, another brand that caters to young consumers and who are its main market and target audience. Boohoo Group, Frasers and a consortium made up of AuthenticBrands / JD Sports may also be interested.
The news would be worrying for store workers and a problem for store owners, as Asos is an e-retailer and the chances of it wanting to run a store are slim. On Saturday night, Sky News quoted a source close to Asos as saying that no deal had yet been reached.
What seems to influence the whole process is the possible purchase price. Brand Finance estimated the value of Arcadia’s brands at about 800 million pounds a year ago, but this valuation fell by half the moment the business was put under management. Estimates of Topshop’s value were about £ 200 million at the end of last year.
From the Arcadia empire, the Evans brand (to the Australian City Chic) was already sold and it was decided to close the Outfit chain. Now only Topshop / Topman (major Arcadia brands), Burton, Dorothy Perkins, Wallis and Miss Selfridge remain.
Although Topshop is considered the most in-demand of these brands, it was speculated that managers might have a difficult time getting deals in excess of £ 200 million. But now there is talk of offers ranging between 250 and 300 million pounds. Next, for example, considers that it is too high a figure in a context as complicated as the current one. However, Next would have considered the value of the brands from a multichannel point of view and not from a purely electronic point of view, which could partly explain the different values that the bidders assign, The investment necessary to get the brands to recover profitability through brick-and-mortar stores could be much higher than if they became an exclusively digital business.
The administrator, Deloitte, is obliged to get the best possible price and it is unlikely that that price will be paid by any bidder who is not going to close the hundreds of physical stores and end up with thousands of jobs, a fact that should concern us.
Source: Fashion Network