NEXT eyes potential rescue bid for troubled beauty chain The Body Shop

Acquisitive high street giant NEXT is reported to be considering a rescue bid for troubled beauty retailer The Body Shop.

It has been reported that NEXT has contacted the administrators for The Body Shop, FRP Advisory, about the potential to purchase any assets of the chain as part of the sale process that is about to get underway.

According to Sky News, NEXT had been eyeing The Body Shop for some time. In recent years the high street group has acquired a number of names, often out of administration, including Cath Kidston, Made.com and Joules. It also acquired large stakes in Jojo Maman Bébé and Reiss and has joint venture agreements with Victoria's Secret and Gap.

However, Sky reports that one potential stumbling block for a potential deal for The Body Shop lies with the IP and brand, which are said not to be a part of the administration process. It is believed that private equity house Aurelius, which acquired The Body Shop at the end of last year for £207 million from Brazilian beauty brand group Natura & Co and put it into administration this month, has been funding the rest of the business since and as part of that secured assets such as the IP and brand.

One possible outcome of the administration process is that Aurelius re-acquires a restructured version of The Body Shop. Already FRP has embarked on a restructure of The Body Shop's head office and is closing almost 200 (around half) of its UK stores. Any deal with NEXT is said to be unlikely to save a large number of its stores.

"A reduced store footprint will coincide with a renewed focus on the brand’s products, online sales channels and wholesale strategies, bringing it in line with industry peers and supporting a return to financial stability," a statement from FRP said when it announced closures last week.

The collapse of The Body Shop, which was founded in 1976 by pioneering retailer and activist Anita Roddick, has prompted a huge debate in the beauty market about how the brand lost its way without its visionary founder at the helm. Roddick was a trailblazer when it came to sustainable and cruelty-free beauty and the business boomed in the 1980s and into the 1990s but began to lose its shine into the early 2000s and Roddick and her husband Gordon stepped back from the running of the business in 2002. It was then sold to L'Oréal for £652.3m, who took the business global but it largely trod water under its ownership, and many questioned decisions such as offshoring manufacturing, and it was offloaded to Natura & Co in 2017.

Natura sold it to Aurelius at the end of 2023 but, after a tough Christmas, it was put into administration this month.

Key Milestones in The Body Shop story

1976: Trailblazing entrepreneur and activist Anita Roddick and husband Gordon opens the first branch of The Body Shop in Brighton

1984: The Body Shop is floated on the London Stock Exchange

2002: The Roddicks step back from running the business, but remain in non-executive roles and retain shares

2006: The Body Shop, which at this point has 305 stores, is sold to the French cosmetics giant L'Oréal for £652.3m

2017: L'Oréal sells The Body Shop to Brazil's Natura & Co for approximately £870m

November 2023: Natura & Co sells The Body Shop to private equity house Aurelius for £207m

February 2024: Aurelius appoints FRP Advisory as administrators putting 200 stores at risk