Debenhams’ online operations purchased by boohoo as remaining stores to be wound down

Online fashion giant boohoo has purchased parts of Debenhams, the anchor tenant at Eagles Meadow, however the retailers physical stores look set to close.

Debenhams was already in the process of closing down with administrators failing to secure a takeover deal for the entire business.

In a trading update this morning Boohoo said boohoo it has “acquired all of the intellectual property assets (including customer data and related business information and selected contracts) of Debenhams Retail Limited” from its joint administrators, for £55 million.

boohoo said, “Debenhams is a long-standing and leading UK fashion and beauty retailer with high brand awareness, and an established online platform with approximately 300 million UK website visits per annum. This makes it a top 10 retail website in the UK by traffic.

John Lyttle, CEO, commented: “The acquisition of the Debenhams brand is an important development for the Group, as we seek to capture incremental growth opportunities arising from the accelerating shift to online retail. We have developed a successful multi-brand direct-to-consumer platform that continues to disrupt the markets that we operate in. The acquisition represents an exciting strategic opportunity to transform our target addressable market through the creation of an online marketplace that leverages Debenhams’ high brand awareness and traffic through the development of beauty and fashion partnerships connecting brands with consumers.”

Mahmud Kamani, Executive Chairman, commented: “This is a transformational deal for the Group, which allows us to capture the fantastic opportunity as eCommerce continues to grow. Our ambition is to create the UK’s largest marketplace. Our acquisition of the Debenhams brand is strategically significant as it represents a huge step which accelerates our ambition to be a leader, not just in fashion eCommerce, but in new categories including beauty, sport and homeware.”

The company noted the transaction “does not include Debenhams’ retail stores, stock or any financial services” adding “In order to allow for the winding down of Debenhams’ operations, Debenhams will continue to operate its website for an agreed period before the relaunch on the Group’s platform and a licence has been granted to allow for the winding down of Debenhams’ retail stores (when they are in a position to re-open) for an additional period.”

Administrators have previously said stores will reopen once pandemic restrictions allow, but soley to clear stock, much like the website is doing at the moment via a ‘closing down sale’.

That position has been expanded on this morning, in the Evening Standard and the LSE.co.uk administrators state that the sale to boohoo today will mean all stores will close, with the administrators FRP Advisory, saying “The closing down sale will continue in stores for several weeks until the stock liquidation is completed and the value of this stock will be retained for creditors. Regrettably, all the UK stores will then be permanently closed.”