Retail’s seen a flurry of activity in the past few days with Frasers quickly buying up bankrupt Missguided, plus-size luxury e-tailer 11 Honoré finding a new home with Dia & Co, Xcel Brands handing off the majority of its ownership in Isaac Mizrahi, and Ted Baker reportedly inching toward an Authentic Brands Group (ABG) deal. Even as Neiman Marcus closed on its Farfetch investment, Kohl’s remains an enigma as question continue to swirl around the embattled department store retailer.
Across the pond, the 15:17 department store retailer is nearly finished liquidating after launching just prior to the pandemic.
Frasers Group buys Missguided IP assets
Missguided’s brush with bankruptcy is brief after the fast-fashion e-tailer found a rescuer in the form of Frasers Group, though JD Sports as well as Boohoo and Asos, both rivals to the cheap and chic player, were also said to be sniffing around. Michael Ashley’s company put up 20 million pounds ($25.2 million) to take over the Shein competitor along with its men’s focused sibling brand Mennace.
Frasers, which also owners Flannels, House of Fraser and Jack Willis, will operate Missguided independently once the e-tailer is out of an eight-week transitional administration period.
Frasers CEO Michael Murray said Missguided will “benefit from the strength and scale of FG’s platform and our operational excellence.”
“Missguided’s digital-first approach to the latest trends in women’s fashion will bring additional expertise to the wider Frasers Group,” he added.
Dia & Co. expands to luxury plus-size apparel
11 Honoré is under new ownership after Dia & Co. broadened its plus-size fashion offerings by acquiring the high-end e-tailer selling Diane Von Furstenberg, Carolina Herrera, Good American, Altuzzara, Vince and Tanya Taylor in addition to its own private-label collection. Dia said the deal furthers its goal of becoming a one-stop shop for the 100 million customers shopping for women’s sizes 10-32.
For now, Dia plans to keep the five-year-old startup as its own premium e-commerce fashion destination, 11honore.com, until it can be fully integrated with dia.com. It will sell 11 Honoré’s private brand on dia.com.
Xcel Brands sells Isaac Mizrahi stake
WHP Global purchased a 70 percent stake in Isaac Mizrahi from Xcel Brands. The $68 million transaction includes a $46.2 million cash payment to Xcel, which will retain a 30 percent interest in the brand.
Xcel will continue to manage Isaac Mizrahi’s QVC business and serve as the apparel licensee in the U.S. and Canada.
“Selling a majority interest in the Isaac Mizrahi brand is a transformative moment in Xcel’s history and represents the first time we have monetized one of our brands since Xcel was founded in 2011,” Xcel chairman and CEO Robert D’Loren said. “Xcel is now debt-free, with over $17 million in cash and $22 million of working capital on our balance sheet, which will help fuel a number of our upcoming strategic initiatives as we concentrate our resources on growing our brands, new brand launches and investing in livestreaming technology platforms and partnerships.”
WHP chairman and CEO Yehuda Shmidman said his company sees “meaningful opportunities to expand the brand by leveraging WHP Global’s platform and the reach of our fashion vertical, which now includes Anne Klein, Joseph Abboud, Joe’s Jeans, William Rast and Isaac Mizrahi.”
Authentic Brands in lead for Ted Baker
Ted Baker is said to have picked Reebok owner ABG as its preferred bidder last week, after private equity firm Sycamore Partners dropped out of the process of bidding for the British contemporary label.
A takeover deal could be worth 300 million pounds ($378.6 million), Bloomberg reported Monday. ABG representatives did not return a request for comment.
ABG has been hunting overseas for deals to add to its portfolio. It’s part of a consortium led by Leonard Green & Partners—an ABG investor—that is in talks to acquire Kohl’s.
One retail analyst isn’t so sure about Kohl’s going rate.
UBS retail analyst Jay Sole doubled down on his position that investors should sell their shares in the Menomonee Falls, Wisc.-based retailer.
In a report, Sole said “weaker-than-expected sales growth and margin compression” were behind Kohl’s recent earnings miss. He questioned not just flagging store traffic, but also how the department store chain will handle inflation. Sole also isn’t sure Kohl’s can maintain last year’s margin as retail seems to be creeping back into the promotional habits it temporarily abandoned, particularly as the fashion mood is swinging toward social dressing that’s out of alignment with the company’s activewear-focused ambitions.
Kohl’s shares are trading in the $40.90 range. Sole lowered his price target to $32.00 from $38.00 per share, citing the upside risk that an investor takes the company private at a price higher than the current trading range.
Sycamore Partners, Hudson’s Bay Co. and Franchise Group are said to be interested in putting offers in for Kohl’s.
Neiman closes $200 million Farfetch investment
Neiman Marcus said it closed on Farfetch Ltd.’s $200 million minority investment as part of a broader strategic partnership.
The tie-up builds on Farfetch’s luxury vision by replatforming Neiman’s Bergdorf Goodman brand website and mobile app onto the Farfetch Platform Solutions, while proceeds from the investment will help Neiman further accelerate growth and innovation via technology and digital capabilities. In addition, both Bergdorf and Neiman will join the Farfetch Marketplace as partners.
“Farfetch’s investment demonstrates its confidence in our omnichannel strategy, and we look forward to partnering with them to continue revolutionizing the luxury customer experience and delivering value to all our stakeholders,” Neiman CEO Geoffroy van Raemdonck said.
15:17 ordered to liquidate
The department store 15:17 is in the process of winding up what’s left of its liquidation. It had one location in Wales in Cardiff, as well as five in England and two in Scotland, where the first location opened in Ayr. The Welsh location had taken over a Topshop store after the latter’s parent company Arcadia went bankrupt in November 2020.
The Welsh store essentially closed in January and creditors in February pushed for a wind-up order to collect on debt. That eventually pushed the company into liquidation in April. A U.K. court formally entered a wind-up order this week.
The retail chain launched in 2019 and billed itself as a community gathering place offering gym classes, food and fashion from a host of concessionaires including local and national brands.