The Frasers Group, the British retail and intellectual property firm controlled by Mike Ashley, the founder of Sports Direct, has reportedly acquired troubled online fashion company, Missguided out of administration in a £20 million ($25 million) cash deal.
As per reports, Frasers, which holds the Sports Direct, Flannels retail chains, and House of Frasers, announced it had bought some intellectual property of Missguided Ltd as well as its affiliated entities Missguided (IP) Ltd, and Mennace Ltd, in a purchase funded through working capital.
Following the completion of the deal, Missguided would continue to be run by the administrator through a transitional contract for around eight weeks before it is established as an independent business inside the Frasers Group.
Michael Murray, Frasers Group CEO, stated that the firm was thrilled to guarantee a long-term future for the online retailer, adding that the firm would stand to gain from the scale and strength of Frasers Group's platform as well as its operational expertise.
For the uninitiated, Missguided went into administration at the start of the week after being served with a winding-up petition by its own clothing suppliers who it owed millions of pounds, threatening the jobs of approximately 140 people.
It is currently unclear how many jobs will be preserved as a result of the Frasers' purchase. According to a source, the firm's administration immediately resulted in the elimination of roughly 80 jobs.
Teneo's administrators were unable to land a last-minute rescue proposal for Missguided, which hit the headlines three years ago with its £1 bikini, which the company sold at a loss as a marketing tactic.
Several suppliers of Missguided in the UK and abroad are believed to have gone without any payment for months now. Over a dozen UK vendors have claimed they are due millions of pounds for product orders that were placed as recently as last month.
There were speculations that Missguided may be purchased by Boohoo, a bigger online fashion competitor, as part of a pre-pack administration transaction. Those talks, however, were eventually unsuccessful.