Asos sells Topshop as part of refinancing strategy
Asos has divested 75 per cent of Topshop and Topman to the Holch Povlsen family, the owner of another online fashion retailer Bestseller, for £135 million (US$177.9 million).
The Holch Povlsen family will finance the acquisition through its own investment company Heartland, with Asos retaining its 25 per cent stake in the brands.
Asos said that the sale will help the company allocate capital more efficiently and accelerate its core Back to Fashion restructuring strategy.
“The joint venture and the launch of the refinancing will accelerate our strategy to both offer customers the best and most relevant product and to turn Asos into a company that delivers sustainable, profitable growth,” said Jose Antonio Ramos Calamonte, Asos CEO.
“Through the joint venture, new opportunities, both online and offline, can be explored and we are excited to continue to be part of the brands’ future while also realising the best value structure for Asos shareholders today.”
The transaction is expected to have a £10 million to £20 million impact on earnings before interest, taxes, depreciation, and amortisation (EBITDA) in the next fiscal year and to be increasingly EBITDA accretive over time.
Asos intends to relaunch Topshop.com within six months of completing the transaction.
Asos acquired Topshop and Topman, along with Miss Selfridge and Hiit, in February 2021 after their parent company, Arcadia, fell into administration.
Meanwhile, Asos said its Test and React strategy, which brings a product from design to site in less than three weeks, has become faster.
Test and React now accounts for 10 per cent of the company’s own brand sales by the end of the year.
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