Boohoo confirms bid for Karen Millen and Coast
The online fashion giant want the online divisions of the British brands, but the future for stores is uncertain
Fast-fashion internet giant boohoo has confirmed it has made an offer to buy the online businesses of Karen Millen and Coast.
The deal could be approved as soon as Tuesday, but the future of 1,100 staff in 32 stores and 177 concessions across the UK remains in doubt.
Boohoo said it had “made an offer to acquire the online business of renowned British brands Karen Millen and Coast, together with all associated intellectual property rights”.
Bosses want to add the brands to its roster, which already includes PrettyLittleThing, Nasty Gal and MissPap, but there was no word on the stores.
The sale of the online businesses could lead to the high street stores being pushed into administration by current owner Icelandic bank Kaupthing.
Karen Millen has been loss-making for years, losing £5.7 million in 2018 and £11.9 million a year earlier.
Coast has also struggled, in part due to its locations in several Debenhams and House of Fraser stores, which have both had their own high street woes in recent years.
By comparison, boohoo revealed a 39% jump in sales in the three months to May 31.
Retail analysts at Jefferies said investors should welcome the decision.
They said: “Karen Millen and Coast are both strong UK brands, in our view, with distinctive premium ranges, including work wear and occasion wear, that would complement the existing group brands.
“If acquired, we would expect boohoo to keep the creative teams and brand marketing completely separate but seek to leverage its efficient sourcing, distribution and IT infrastructure to grow the business globally and make it more profitable.”
They added that sales for the brands are likely to be around £40 million to £50 million.
Boohoo said the bid “may or may not result in agreement of a transaction”.