Next has pulled out of the race to acquire the remains of Sir Philip Green’s Arcadia empire after balking at the price tag for chains including Topshop and Topman.
With administrators understood to be valuing Topshop at between £250 million and £300 million, Next said that it was “unable” to meet price expectations.
A source said that the high street retailer run by Lord Wolfson of Aspley Guise could not match the deep pockets of rival bidders that want the asset as a trophy or a launchpad in Britain, no matter what the cost.
Arcadia fell into administration in November, putting 13,000 jobs at risk. Its demise capped a fall from grace for Sir Philip, 68, who was knighted in 2006 for his services to retail but who has suffered a series of setbacks in recent years, including the collapse of BHS, the department stores chain. Last month its administrators at Deloitte sold Evans, Arcadia’s plus-size fashion brand, to City Chic, of Australia, for £23 million.
Next is considered one of the strongest names in retail, with about 500 shops in the UK. It had teamed up with Davidson Kempner, an American investment firm, to bid for Arcadia.
However, in a statement last night, the chain said that it had “withdrawn from the process to acquire any, or all, of the Arcadia Group from the administrator, as our consortium has been unable to meet the price expectations of the vendor”.
The race is thought now to be between Shein, a Chinese fast-fashion retailer, and Authentic Brands, a New York City-based brand management company, which has teamed up with JD Sports. Authentic and JD are understood to be interested in the Topshop, Topman and Miss Selfridge brands. Authentic would own the brand and licence it to JD Sports to run as a joint venture. A deal for Topshop would be Authentic’s first foray into Britain.