Joules has confirmed that it is in discussions with Next over a potential equity investment.
The struggling fashion and lifestyle retailer said that the investment would raise proceeds for Joules of £15m at no less than Joules’ current market price.
This would mean Next becoming a strategic minority shareholder in the business.
This move would need to be approved by Joules’ shareholders.
Joules also said that it was in talks to adopt Next’s Total Platform services, to support its “long-term growth plans”.
Next’s Total Platform model allows partner retailers to utilise Next’s expertise and infrastructure including warehousing, distribution networks and call-centre services, whilst leaving creative control to the partners’ management.
The platform also operates at low risk, as retailers pay-as-you-go commission on their sales.
Next currently has brands including Reiss, Laura Ashley, Victoria’s Secret and Gap on Total Platform.
Joules said in its statement that: “There can be no certainty these discussions will lead to any agreement. A further announcement will be made if and when appropriate.”
Next comes under fire over pay
The news comes as Next faces a probe from HMRC over its pay.
The fashion retailer came under fire last month after a botched integration of a payroll system under US firm Oracle led to staff being underpaid for months.
A complaint from a member of Next’s retail workforce has launched an investigation from HMRC over whether Next is paying the correct minimum wage, which currently stands at £9.50 an hour for employees over 23.
Next confirmed the investigation but said that it has been deemed a “medium-risk” corporate taxpayer rather than a low-risk one.
No breaches of the minimum wage have been found yet, but Next has introduced a separate IT system to crosscheck Oracle.
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