Asos’s £295m deal for four failed brands of Arcadia, Topshop, Topman, Miss Selfridge, and HIIT, will likely see 13,000 lose their job in the coming weeks. The online fashion retailer has recently signed a deal with Arcadia group to acquire the brands, however, there is no mention of acquiring the shops leaving the fate of thousands uncertain.
According to the deal, Asos will pay £265m to Arcadia group for the brands and £30m for the stock. Last November, Sir Philip Green’s Arcadia went into administration after challenging trading conditions. Asos say they will re-hire 300 employees who are directly engaged with the brand, design, retail, and buying, but this is a very small number compared to those who are likely to lose their job.
Since the deal, 50 stores of Arcadia has already closed and more than 70 more are about to follow suit. This has resulted in job losses so far of almost 5,000. There is also bad news for 10,000 ex-staff covered under Arcadia’s pension scheme, who are also likely to face difficulties with claiming their retirement benefits.
The deal was completely undisclosed from employees till a team member from Topshop came to know about it through a Tweet. He said, “I woke up this morning and went on my phone, and it was the first thing that I saw on Twitter,” he said. “That was the first word we had, we didn’t hear anything properly from the Arcadia side of things.”
Asos chief executive Nick Beighton said this acquisition is an exciting time for them as these brands are iconic British fashion labels. He also mentioned that the Asos acquisition will speed up their aim to reach the top destinations for 20-somethings fashion lovers all across the world. He continued “The deal makes sense, especially when there is a lot of competition in the market”.
The agreement between Asos and Arcadia is expected to be concluded by the 4th of February.