Storied British department store chain Debenhams, which entered administration for the second time in April 2020, will live on online following the acquisition of its brand and websites by U.K.-based digital fashion retailer Boohoo Group.
Boohoo Group paid £55million ($75 million) for the global rights to the Debenhams brand and websites in a deal that includes all of Debenhams’ in-house brands but none of its physical locations. The acquisition highlights the ongoing power shift from retailers weighed down by brick-and-mortar investments to their more nimble online counterparts — a shift that has only been exacerbated by the pandemic.
After failing to find a buyer last year following a months-long search, Debenhams announced plans to close all its stores and began liquidation sales Dec. 1, 2020. That liquidation will continue despite the Boohoo acquisition, with all the chain’s UK stores set to be permanently closed as soon as stock is cleared. Multiple sources report that the store closures will result in the loss of approximately 12,000 jobs. Current lockdowns across the country have delayed the process, but sales are continuing online. Once Debenhams stores are able to reopen and the stock liquidation can continue in stores, the website will be operated by Boohoo.
The new deal does allow for the potential of “an international franchise network that will operate under licence using the Debenhams name.” Debenhams subsidiary Magasin du Nord in Denmark is not impacted by the sale and will continue to operate independently.
Boohoo, which also owns Nasty Gal, prettylittlething and MissPap, has been on a buying spree the last few years, snapping up the online businesses of Karen Millen and Coast for £18.2 million ($25 million) in August of 2019, then Oasis and Warehouse from Hilco Capital for £5.25 million ($7.2 million) in June 2020.
“We are pleased to have secured the future for this great brand, and to have created the opportunity for a new Debenhams-branded business to emerge in a different shape beyond the pandemic,” said Geoff Rowley, Joint Administrator and Partner of Debenhams administrator FRP Advisory in a statement. “I expect that the agreement with Boohoo may provide some job opportunities, but we regret that this outcome does not safeguard the jobs of Debenhams’ employees beyond the winding down period. We are very grateful that they have worked tirelessly through this very challenging period and will continue to support the closing down sale.”