Jack Wills placed in administration and sold to Sports Direct
Struggling UK fashion chain Jack Wills has been bought by Sports Direct for £12.75 million after being placed in administration.
Sports Direct, owned by retail entrepreneur Mike Ashley, has bought Jack Wills’ stock and taken over its distribution centre, 100 stores and employees across the UK and Republic of Ireland in what is known as a “pre-pack administration” deal.
The fate of the brand’s stores in Hong Kong, Singapore and the US is not yet known with “alternative options being considered” by the company’s directors, according to a statement released overnight.
The Jack Wills business sold to Sports Direct has about 1700 staff spread across the business, six franchised stores in Kuwait, Saudi Arabia, the UAE and the Channel Islands, and an e-commerce channel serving 130 countries.
Pippa Stephens, retail analyst at GlobalData, said that while Mike Ashley has given Jack Wills a much needed lifeline, she fears 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,” said Stephens.
“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.”
Private-equity owner BlueGem began canvassing for prospective buyers for Jack Wills early last month after engaging advisory firm KPMG to prepare a review of the business’ prospects. According to companies office records, Jack Wills lost £29.3 million for the year to January 31 last year, and a £28 million cash injection from BlueGem in January this year has been almost exhausted.