Online retail giant Boohoo has announced it will buy Debenhams’ brand and website for £55m, but will not rescue the high street chain’s stores or jobs.
The deal – announced this morning – means Debenhams’ remaining 118 department stores will close down and could result in up to 12,000 job losses.
Read more: Asos emerges as frontrunner to buy Topshop
Boohoo said the acquisition is an “important development”, which will also see it enter the beauty, sports and homeware market for the first time.
Shares in the e-commerce firm jumped more than four per cent after the offer was confirmed.
“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,” Boohoo chief executive John Lyttle said.
In 2019, Boohoo bought the Karen Millen and Coast brands after they fell into administration as it continued to bolster its digital platform.
Administrators FRP Advisory are in the process of winding up Debenhams’ stores while they hunt for a buyer for all or parts of the business.
Earlier this month it FRP announced it had permanently closed six Debenhams department stores, including its flagship site in Oxford Street, due to the third national lockdown.
The retailer had planned to reopen the stores to sell off remaining stock, but the introduction of new Covid-19 restrictions means that sites where it was unable to secure lease extensions will close.
Debenhams had been struggling for some time, and last year entered administration for the second time in 12 months.
When administrators announced in December that the company would be wound down, it had already permanently closed more than 20 shops and axed more than 6,500 jobs since the coronavirus pandemic took hold of the UK in March.