Boohoo, the growing British online fast-fashion retailer has acquired the intellectual property assets of Debenhams, the oldest and biggest department store in the U.K., for £55 million (€75.3m-$69.1m) in cash, plus value-added tax. The takeover includes Debenhams’ big internet marketplace with the related customer data, contracts and other business information, but none of its 120-plus physical stores. Its inventories and financial services are also excluded from the purchase deal.

Frasers Group, the parent company of House of Fraser and Sports Direct, among other assets, had invested in Debenhams and made an unsuccessful bid for it. Its biggest competitor, JD Sports Fashion, had expressed interest in the acquisition but then pulled out of the negotiations.

In contrast with Selfridges, which managed to raise its sales last year in spite of the coronavirus outbreak because of its modernization, Debenhams has gone through several bankruptcy proceedings lately. 

Boohoo described its acquisition as a “fantastic opportunity” as it aims to create the U.K.’s largest marketplace across fashion, beauty, sport and homeware. It plans to expand the range of products sold via Debenhams’ marketplace by maintaining existing brands and adding new ones over time.

It will continue to operate Debenhams’ online beauty business under its current wholesale model, but will also look to add new brands via the marketplace model. Debenhams’ own fashion brands will be absorbed into Boohoo’s current brand portfolio and sold via the Debenhams website and their respective sites. Debenham’s brands include Maine, Mantaray, Principles and Faith.

In the financial year to Aug. 31, 2020, Debenham’s online business generated net revenues of approximately 400 million pounds (€450.2m-$547.9m). Its online platform has about 300 million visits a year, making it one of the U.K.’s top 10 retail websites by traffic.

The marketplace represented about a quarter of Debenham’s online revenues, generated mainly by the fashion and homeware categories, and the retailer’s own fashion brands totalled another 25 percent of sales. The beauty business generated some 20 percent of the online revenues.

The remaining 30 percent of Debenhams’ online revenues derives from wholesale inventory bought from third-party brands, covering the fashion, sport and homeware sectors. The business will not continue with the change of ownership.

Boohoo expects to relaunch the Debenhams site on its own e-commerce platform in the first quarter of its financial year, starting in March. Debenhams will continue to operate its website for an agreed period before the transfer to Boohoo’s platform. A license has been granted to allow for the winding down of Debenhams’ retail stores and liquidate its remaining inventories for an additional period.

Boohoo is financing the acquisition through its cash balance, which stood at £386.9 million (€435.4m-$530.0m) on Dec. 31. It does not expect the deal to contribute to its revenues over the remaining five weeks of its current financial year and anticipates modest start-up losses in relation to the takeover.

Separately, another big U.K.-based e-tailer, Asos, said that it is in exclusive discussions with the judicial administrators of Arcadia over the acquisition of its Topshop, Topman, Miss Selfridge and HIIT fashion retail chains, while warning that there is no certainty that a deal will be struck. Frasers was cited as one of the bidders for some of Arcadia’s assets as well.

Arcadia, which also owns the brands Dorothy PerkinsBurtonWallisEvans and Outfit, was placed into administration after being badly hit by lockdowns introduced to combat the spread of the Covid-19 pandemic. Arcadia was the biggest concession retail holder in Debenhams stores, and its financial difficulties led JD to end talks to buy the British department store chain.