Asos could retain Topshop flagship if Arcadia deal goes ahead

Asos chiefs see the famous shop at 214 Oxford Street as an iconic fashion destination. Retail Week understands they are considering whether it could continue to play a part in the business, though they are not interested in the rest of Arcadia’s estate.

If Asos was able to operate 214, as the store is known, it may provide opportunities to experiment with new ways in which bricks-and-mortar can complement a fundamentally pureplay business.

Although Asos is very interested in the site, it is possible that no deal will be ultimately be done. 

The rent and rates payable may be a stumbling block and the situation is further complicated by several issues. 

The flagship store is not part of the Arcadia assets being overseen by administrator Deloitte. It is controlled by a subsidiary company, Redcastle (214 Oxford Street) Limited, to which KPMG is the administrator. Additionally, Arcadia’s pension fund is understood to be entitled to part of the proceeds of a sale of Redcastle.

A source familiar with the situation said Asos bosses will “have a conversation” with KPMG about whether a deal can be done but it is “early days”.

Asos revealed this morning that it is in discussions with about acquiring Arcadia’s Topshop, Topman and Miss Selfridge brands, and athleisure brand HIIT. 

The etailer, which would fund the deal from cash reserves, won negotiating exclusivity above other potential buyers including Chinese etailer Shein and US giant Authentic Brands. Next had also been interested but walked away over price.