Fast fashion company Boohoo has bought the Karen Millen and Coast brands out of administration for £18.2m, putting more than 1000 jobs at risk as store closures loom.
The online retailer said it made the acquisitions after Karen Millen entered administration this afternoon. Boohoo shares were up 6.65 per cent following the announcement.
Deloitte, which was appointed as administrator today, said 62 redundancies have been made following the deal.
More than 1000 jobs remain at risk as 32 stores and 177 concessions are expected to close after administrators failed to secure the sale of the entire business. Deloitte said both brands would continue to trade in store “for a short time”.
Rob Harding, Deloitte joint administrator, said: “Karen Millen has been seeking to address the financial challenges that it faced by pursuing a sale of the business and, whilst a sale of the whole business has not been deliverable, the Boohoo transaction facilitates the survival of these iconic British brands through an online platform.
“We thank all employees and other key stakeholders for their support at this difficult time.”
Boohoo said the online businesses, which reported direct online sales of £28.4m in the financial year to February, would be “highly complementary additions” to its e-commerce platform.
Boohoo chief executive John Lyttle said: “The acquisition of the online business of two great and renowned British brands in Karen Millen and Coast represents another milestone in the Group’s growth story as it continues to invest in its scalable multi-brand platform and gain further share in the global fashion e-commerce market.”