Fast-growing pure-play online fashion retailer Boohoo is preparing to acquire the Karen Millan and Coast brands.
According to sources quoted by Sky News, Karen Millen will be placed in administration as early as today, UK time, in what is termed a “pre-pack administration” where the new buyer acquires the assets relatively unencumbered.
The deal – assuming it proceeds – is remarkable in that it reflects the power of new-generation online retailers being in a place to pounce on struggling brands like Karen Millen, itself an icon of the high-street fashion scene.
Boohoo Group, listed on AIM, a subsidiary of the London Stock Exchange, owns a controlling share in PrettyLittleThing. Last month, thanks to an association with reality TV series Love Island and high-profile celebrity endorsements, Boohoo overtook Asos as the most valuable online fashion retailer in the UK, its valuation touching £2.35 billion. Its share price has surged 29 percent this calendar year.
According to Sky News’ sources, Karen Millen is about to appoint Deloitte as administrator of the business, preparing the way for Boohoo to proceed with the purchase.
The two fashion labels have been on the market for six weeks during which management attempted to secure a sale of the business while it remained solvent. Karen Millen bought Coast out of administration last October. Karen Millen and Coast were both previously owned by Icelandic bank Kaupthing.