Giant American fashion and investment corporations are eyeing up bids for Topshop and its parent group Arcadia.
Authentic Brands – which owns a stable of global fashion businesses including Juicy Couture – is understood to be among the interested parties. Rival contenders include private equity titans Fortress, Elliott Management, Apollo and OpCapita, sources told The Mail on Sunday.
Around 30 to 40 potential buyers are believed to have shown initial interest and have received a limited information pack on the business from Arcadia’s administrators, Deloitte. First-round bids are due in by the end of this week.
Window shopping: Around 30 to 40 potential buyers are believed to have shown initial interest
A sale would see Topshop and sister brands Dorothy Perkins, Burton, Wallis and Miss Selfridge operating under new owners for the first time in almost two decades.
Sources suggested a sale of the businesses and their assets, formerly owned by the family of fashion mogul Sir Philip Green until its collapse two weeks ago, could fetch more than £400million.
A source close to one of the potential US bidders said: ‘These are well-known fashion and clothing brands up for grabs, and some with pan-European or global potential in the right hands.
‘The retail market is difficult at the moment but there will be opportunities on the other side of this pandemic for labels that consumers recognise and that work in shops, department stores and online. This is a chance for a new beginning for Arcadia, perhaps.’
Arcadia’s most recently published accounts show that the group made £1.8billion revenue in 2018.
Topshop is sold in US department store Nordstrom, while the brand and other labels in the group are sold online through Asos and German internet giant Zalando as well as through their own websites.
But the group has been battered as the shift from the high street has accelerated and left stores struggling to attract customers in deserted town centres. Arcadia restructured last year through a closely managed insolvency process known as a CVA, but a slump in fashion sales during the pandemic drove the business to the wall.
Interested British firms are rumoured to include online retailer The Hut Group, Tesco, Next, M&S and Boohoo. Billionaire sportswear tycoon Mike Ashley has already flagged his interest.
Authentic Brands Group was set up in 2010 by Jamie Salter, former chief executive of private equity firm Hilco Consumer Capital. It is backed by Larry Fink’s US investment giant BlackRock. New York private equity firm Leonard Green is also an investor.
The group has built up a stable of fashion brands as well as snapping up the estates of Muhammad Ali, Elvis Presley and the image rights to Marilyn Monroe.
It also owns fashion brands Hervé Leger, Lucky Brand Jeans, Nautica, Nine West and US publication Sports Illustrated.
The UK arm of the New York investment firm Elliott Management owns British bookstore Waterstones and Apollo owns high street accessories group Claire’s. Mike Ashley, who owns House of Fraser and stalked Debenhams for years, last month tried to intervene in the collapse of Arcadia, offering a £50million loan to tide the group over until after Christmas.
The offer was dismissed as a ‘publicity stunt’ by City sources and the loan never happened.
The subsequent collapse of Arcadia put the future of up to 500 shops and 13,000 jobs in jeopardy.
A sale to a US giant would underscore the colourful history of the group since it was acquired by the Green family in 2002 and made Sir Philip one of Britain’s most recognisable businessmen.
Shortly after the purchase in 2005 he paid his family firm – owned by his wife Lady Green – a £1.2billion dividend described at the time as ‘the biggest pay cheque in British corporate history’.
Green garnered a reputation as the King of the High Street and even took Topshop to New York, opening a flagship store on Fifth Avenue. But the £1.2billion payment also provided a lightning rod to those who have sought to criticise the controversial tycoon and the struggling business.
A slump in retail markets on both sides of the Atlantic piled pressure on the group and the Fifth Avenue store was closed as part of a restructuring in 2018.