More bad news for King's Lynn High Street as Burton and Dorothy Perkins shops close
Around 2,450 staff nationwide are being told that their jobs have been axed after clothes website Boohoo bought Dorothy Perkins, Wallis and Burton for £25.2 million.
The deal is for the inventory, e-commerce and digital assets of the businesses, which were owned by Sir Philip Green’s Arcadia retail empire when it entered administration in December.
But it does not include the brands’ 214 remaining shops, which will close, according to administrators from Deloitte.
There is a Dorothy Perkins and Burton store on Lynn High Street, opposite Boots.
Staff were emailed on Monday morning, and will be informed during the day.
Around 260 jobs, mainly head office roles, will be saved as they move with the brands to Boohoo. These include jobs in design, buying and merchandising, and the businesses’ digital wings.
Some other staff will be kept on during a months-long transition period, Deloitte said.
The deal will see the brands transfer over to online fashion giant Boohoo, whose fortunes have increased as those of its high street predecessors waned.
Last month Boohoo said it had bought the brand and website of department store chain Debenhams for £55m, but it did not take on the company’s 118 stores, meaning around 12,000 jobs were likely to be lost.
Boohoo chief executive John Lyttle said: “We are delighted to announce the acquisition of the assets associated with the online businesses of the three established brands Burton, Dorothy Perkins and Wallis.
“Acquiring these well-known brands in British fashion out of administration ensures their heritage is sustained, while our investment aims to transform them into brands that are fit for the current market environment.
“We have a successful track record of integrating British heritage fashion brands on to our proven multi-brand platform, and we are looking forward to bringing these brands on board.
"We continue to grow our portfolio of brands and customer base, strengthening our position as a leader in global fashion e-commerce.”
Arcadia was long one of the biggest players on the UK high street, but the covid-19 pandemic dealt a final blow to the business, which had struggled with a shift in shopping behaviour in recent years.
In December it entered administration, putting thousands of jobs on the line.
While the business’s demise has been partly brought about by a shift to online retail, its brands will now continue to live online, after several deals.
Last week Boohoo rival Asos, also an online player, signed a £330 million deal to buy Topshop, Topman, Miss Selfridge and HIIT from Arcadia.
Administrators have now sold all of Arcadia’s brands, raising around £500m to pay off creditors. There is still some property in the portfolio left to sell.
Retail trade union Usdaw is seeking urgent meetings with Arcadia administrators and urges them to treat staff with fairness and dignity, after Boohoo today confirmed the takeover of Arcadia brands Burton, Wallis and Dorothy Perkins. Usdaw is also calling on the Government to urgently act to save our high streets.
Dave Gill – Usdaw National Officer says: “The sale of three more major Arcadia brands to an online only retailer is another devastating blow for our high streets, coming after other Arcadia brands were sold to Asos and the Debenhams brand was bought by Boohoo. Arcadia and their administrators have refused to engage with Usdaw and we urge them to reverse their anti-union stance.
“Usdaw is the trade union for Arcadia staff and they must be treated with the dignity and respect they deserve. We continue to provide our members with the support, advice and legal representation they need at this very difficult time.
“What retail needs is a joined up strategy of unions, employers and government working together to develop a recovery plan. Usdaw has long called for an industrial strategy for retail, as part of our ‘Save our Shops’ campaign, to help a sector that was already struggling before the coronavirus emergency.
“There are substantial issues that need to be addressed. That is clearly demonstrated by the exodus of prime high street brands to online retail. Today we have renewed our call for an online sales tax to help level the playing field between online and bricks and mortar retail.
“Retail is crucial to our town and city centres, it employs around three million people across the UK. The Government must take this seriously; we need a recovery plan to get the industry back on its feet.”