Acquisitive retail group Sports Direct International has acquired Jack Wills in a GBP12.75m (US$15.5m) rescue bid after the ailing lifestyle brand fell into administration on Monday.
Sports Direct announced the acquisition late yesterday (5 August), with the pre-pack administration deal including all of the UK and Republic of Ireland stores and stock and the international Jack Wills brand.
The news follows speculation at the end of last month that Spectre Holdings, the investment vehicle of Edinburgh Woollen Mill owner Philip Day, was eyeing the UK fashion brand.
It is the latest in a high street acquisition spree by Sports Direct owner Mike Ashley. The mogul acquired department store chain House of Fraser last August and then launched a takeover bid for rival Debenhams. Sports Direct also owns premium fashion chains Flannels, Cruise and Van Mildert.
But recently Ashley lamented “terminal problems” at House of Fraser, saying the group might have made “a different decision” regarding the business had it had the gift of hindsight.
Pippa Stephens, retail analyst at GlobalData, is also concerned the the Jack Wills buy could be headed in the same direction.
“Though Mike Ashley has given Jack Wills a much-needed lifeline, he already has far too much on his plate to make the ailing lifestyle brand a priority and implement a successful turnaround strategy. While Ashley recently admitted that he regrets purchasing House of Fraser, significant time and money are still required to resurrect the failing department store retailer, making it the focus if Ashley is to retain his self-penned ‘saviour of the high street’ label.
“Jack Wills has lost relevance in the UK clothing market as its heavily branded, preppy products no longer appeal to 16-24 year-olds who now prefer more edgy, aspirational brands. Consistent discounting has devalued its full price proposition, while its stores have lost their appeal and uniqueness.
“Jack Wills needs to be substantially revamped if it is to revive its desirability, win back shoppers and establish a new loyal customer base. Without sufficient investment in modernising ranges and improving the in-store experience, we expect it to continue to struggle in today’s competitive youth segment.”
Greg Lawless, analyst at Shore Capital, adds: “Sports Direct remains a buyer of distressed business but in our view, it already has its plate full with House of Fraser and the recent results highlighted the difficulties that the core business is facing. Given the GBP14.2m loss at Jack Wills for the most recent period [year to Jan 2018] it will add to management’s inbox to sort the business in short order in terms of leases for standalone stores. The fallout from UK high streets continues at pace with both potential developments.”