Business

'Disturbing trend' of online retailers buying high street brands continues as Asos snaps up Topshop

<span style="font-family: Arial, sans-serif; ">Topshop's flaghip store in Belfast's Victoria Square will soon be vacated following the Asos deal to buy the former Arcadia brand. Picture by Hugh Russell.</span>
Topshop's flaghip store in Belfast's Victoria Square will soon be vacated following the Asos deal to buy the former Arcadia brand. Picture by Hugh Russell. Topshop's flaghip store in Belfast's Victoria Square will soon be vacated following the Asos deal to buy the former Arcadia brand. Picture by Hugh Russell.

MORE well-known fashion brands will disappear from the high street after Asos confirmed a £265 million deal to takeover Topshop and three other brands from the failed Arcadia retail empire.

The online fashion retailer is buying Topshop, Topman, Miss Selfridge and HIIT, but it won’t take on its stores.

Administrators for Sir Philip Green's retail group said Asos has paid an additional £65m for current and pre-ordered stock.

Asos told investors on Monday morning that it will take on around 300 employees as part of the deal, which will not include any of the brands' stores.

Arcadia collapsed into insolvency at the start of December after pandemic closures further exacerbated the group's troubles.

It comes a week after Boohoo announced a similar deal to acquire the Debenhams brand triggering a wave of store closures.

Last week, Boohoo said it was in exclusive talks to buy Arcadia’s Dorothy Perkins, Wallis and Burton brands in another move which will also not include any stores.

Glyn Roberts of Retail NI described it as “a disturbing trend”, warning that it will have huge implications for retail centres and the high street.

“This is a further blow to our struggling high streets and dreadful news for Topshop, Topman and Miss Selfridge staff and their families as they face an uncertain financial future,” said the chief executive.

“It is not just the immediate impact of these stores closing; it is also the reduced footfall for surrounding traders that will be a direct result of this purchase by Asos.

“Our high streets can have a future,” he added, “But it will be very different one which will be based on making them fun, family-friendly and above else, providing an experience for the shopper.

“Independent retailers who can provide that something different, will be a key part of the new 21st century high street”

Picture by Hugh Russell.&nbsp;
Picture by Hugh Russell.  Picture by Hugh Russell. 

Asos said its acquisition of the four former Arcadia brands will "resonate" with its core customer base of "20-somethings" in the UK.

It said it expects the deal to complete later this week, adding that it will also see £20m worth of one-off restructuring and transaction costs.

Asos chief executive Nick Beighton told reporters on Monday that the company was "looking at" the possibility of retaining Topshop's flagship store on Oxford Street, but admitted it was "not a priority".

"It is something we are considering but we are not a stores business," he said.

"Our priority is to double down on the brands, which we've seen perform incredibly well across our platform."

Asos said the Topshop, Topman and Miss Selfridge websites will start re-directing customers to Asos from "Wednesday evening or Thursday morning".

Mr Beighton said more clothing lines from the acquired brands will appear on its site from this period, with the first Asos-designed Topshop and Topman products expected to appear later in the year.

He added: "We are extremely proud to be the new owners of the Topshop, Topman, Miss Selfridge and HIIT brands.

"The acquisition of these iconic British brands is a hugely exciting moment for Asos and our customers and will help accelerate our multi-brand platform strategy.

"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."