Next has teamed up with the founder of the collapsed fashion chain Joules to rescue it from administration in a £41m deal that will save about 100 shops and 1,450 jobs.
Sources said Next placed a last-minute bid in the early hours of Thursday morning, trumping one placed by South Africa’s Foschini Group, the owner of Hobbs and Whistles. Marks & Spencer and Mike Ashley’s Frasers Group are also thought to have taken an interest in Joules, which is best known for its jackets and patterned wellington boots.
Next said it intended to continue to operate about 100 Joules stores and retain the majority of jobs, including at head office, but 24 stores are to close with the loss of about 130 jobs. Administrators from Interpath Advisory will close 19 of those stores on Thursday.
Joules’ website will gradually be switched on to Next’s Total Platform operation, which already provides services for brands including Gap and Victoria’s Secret to which Next holds the UK rights.
Simon Wolfson, the chief executive of Next, said: “We are excited to see what can be achieved through the combination of Joules’ exceptional product, marketing and brand-building skills with Next’s Total Platform infrastructure.”
Next said it had taken a 74% stake in Joules with the founder Tom Joule taking the remaining 26%, and had bought the majority of the retailer’s assets including paying £7m for Joules’ head office in Market Harborough.
Tom Joule said it was important the company now “live up to the high standards [its customers] desire in design, quality and [service]”.
“I’m truly looking forward to inspiring teams with clear direction to excite and recapture the imagination of the customer again,” he said.
“I’m so pleased that we have been able to strike a deal that protects the future of the company for all its loyal customers, its employees and also for the town of Market Harborough, which have been so central to Joules’ success.”
Joules called in administrators last month, putting 1,600 jobs and the future of its 132 shops at risk, after failing to secure emergency funding. Shops have continued to trade as administrators from Interpath Advisory said they would “assess options for the business”.
Will Wright, the head of restructuring at Interpath Advisory and joint administrator, said: “Following a highly competitive process, we are pleased to have concluded this transaction which secures the future of this great British brand, as well as safeguarding a significant number of jobs.”
Joules has been struggling for months with falling sales. It has attributed the slower trade to the cost of living crisis and the UK’s dry and hot summer, which reduced demand for its posh wellies.
The value of shares in Joules slumped 95% over the course of the past 12 months to 9.22p before trading was suspended and administrators were called in. At that price, the company’s market value was £10.3m, about a quarter of its value on its listing on London’s Aim junior stock market in 2016.
Joule founded the company in 1989 selling branded clothing and accessories at outdoor events. After spotting the country set wanted more colourful clothes than dowdy tweeds, he introduced his own line of pink wellington boots, which sold out immediately.
Joule, who made tens of millions of pounds from floating the company, returned as an executive director in September to try to lead a last-ditch turnaround. He said at the time of the administration it was a “deeply disappointing day for Joules, and a sad day for me personally”.