ASOS emerges as strong contender to land Topshop

ASOS has emerged as a strong contender to acquire the Topshop brand from Sir Philip Green's collapsed Arcadia fashion retail empire.

Following last night's news that Next had exited the race, having worked on a joint bid with US investor Davidson Kempner, the online fashion giant is said to be a frontrunner, according to The Guardian.

While ASOS's name has been mentioned as one of those potentially circling Topshop, it had not until now been reported as one of the serious contenders.

ASOS already sells the Topshop brand on its website and from a customer-profile perspective it is very well matched. However, unlike Next, ASOS is unlikely to want to take any of Topshop's stores.

Fellow online group Boohoo had been the early favourite to land Topshop, and again would have not taken its stores, but is now said to be an outside bet.

Others in the frame include a joint bid by US group Authentic Brands and JD Sports, as well as Chinese fast fashion group Shein. The international groups are said to be keen to use Topshop as a launch pad into the UK.

Next is said to have baulked at the price tag for Topshop, which was initially believed to have been set at around £200m but is said to have ballooned to between £250m and £300m amid a flurry of bids.

Administrators at Deloitte had set a deadline for bids of last Monday but there was said to be some flexibility with that date.

As well as Topshop, which is the prized asset, Deloitte is selling Miss Selfridge, Wallis, Dorothy Perkins and Burton. Plus size brand Evans was sold to Australia's City Chic Collective in December.

Others said to be circling include Marks & Spencer and Mike Ashley's Frasers Group, who may be interested in picking up some of the smaller brands.

The Topshop flagship store on Oxford Circus is being marketed separately from the brand and is expected to attract strong interest. Given the timing of the current lockdown, it has been reported that it is unlikely that the store will open again as a Topshop unless the successful bidder for the brand also secures the lease for the store.

ASOS has been one of the most robust fashion performers of the crisis and last week reported retail sales up by 23% to £1.32bn for the four-month period to 31 December. CEO Nick Beighton has kept his cards close to his chest about any potential bid for Topshop.

However should ASOS acquire Topshop, it would be a landmark in the shift of power in fashion from the old guard to the new. Founded in 2000 by entrepreneur Nick Robertson, ASOS shook up the high street during the noughts and left big names, including Arcadia who were slow to grasp the online opportunity, floundering in its wake.

Sir Philip Green was said to have made a number of approaches to acquire ASOS in its early days but they came to nothing. He repeatedly refused to allow ASOS to sell Topshop online but eventually relented in 2019 when a small selection of product was made available.