LONDON, Sept. 17 (Reuters) – UK clothing retailer Next (NXT.L) has reached an agreement with Gap (GPS.N) to manage the American brand’s activities in the UK and Ireland, further strengthening its presence in the market after demonstrating resilience during the COVID-19 pandemic.
The deal gives Gap the opportunity to retain a significant presence in Britain and Ireland, having closed stores in those markets earlier this year. Read more
The two groups will form a joint venture to operate Gap’s e-commerce business on the NEXT Total platform, set up Gap branded stores and provide click-and-collect options for online customers from 2022.
Shares of Next rose 1.6% at 0842 GMT, taking their 2021 gains to 16.3%.
The partnership echoes steps taken by online retailers ASOS (ASOS.L) and Boohoo (BOOH.L) to grab fashion brands that have gone out of business in the UK and are no longer available in the greater public.
ASOS bought the Topshop, Topman, Miss Selfridge and HIIT brands in February from the directors of Philip Green’s collapsed Arcadia group for £ 265million. Read more
In January, Boohoo bought the non-administration Debenhams brand for £ 55million and in February the Dorothy Perkins, Wallis and Burton brands from Arcadia directors for £ 25.2million.
Next will own 51% of the JV, while Gap will own 49%.
Gap will be able to use the Next store network in the UK and Ireland of approximately 500 stores.
Next is also present online in over 70 countries and sells its own brand and over 700 other fashion, home and beauty brands.
“Gap is partnering with Next … to expand our omnichannel business and meet our customers in the UK and Ireland where they currently shop,” said Mark Breitbard, CEO and Chairman of Gap Global.
In July, Next raised its profit forecast after pent-up demand for adult clothing and warm weather helped it crush sales forecasts. Read more
Reporting by James Davey; Editing by Kate Holton and Alexander Smith
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