Next, the FTSE-100 retail behemoth is among a pack of suitors considering a new year swoop to buy LK Bennett, the struggling fashion retailer.
Sky News has learnt that Next is weighing a cut-price offer to buy LK Bennett’s brand and other intellectual property assets as it prepares to call in administrators.
Retail industry sources said that Next was unlikely to pursue any offer involving LK Bennett’s small estate of retail outlets.
Marks & Spencer and TFG London, the group that owns Phase Eight, White Stuff, and Hobbs, were also among the parties tipped by analysts as contenders to consider the acquisition of the ailing brand.
An offer from Next,
An offer from Next would mirror its strategy of acquiring distressed retailers in recent years.
It has bought brands such as Cath Kidston, Joules and Seraphine, a maternity wear retailer, while it is currently examining the purchase of family-owned footwear retailer Russell & Bromley.
LK Bennett filed a notice of intention to appoint administrators earlier this week, ten days after Sky News revealed that the company faced collapse as it urgently sought a buyer.
Founded by Linda Bennett in 1990, LK Bennett has been working with advisers at Alvarez & Marsal (A&M) in recent weeks.
At one stage, LK Bennett was one of the most recognisable brands on the high street, expanding to 200 branded outlets in the UK and overseas markets, including China, Russia, and the US.
In its home market, it now trades with just nine standalone stores, with a further 13 listed as concessions on its website.
The brand is currently owned by Byland UK, a company established in 2019 for the purpose of rescuing LK Bennett from a previous brush with insolvency.
Byland UK was formed by Rebecca Feng, who ran LK Bennett’s Chinese franchises.
At the time of that deal, Ms Feng said: Ms Feng said, “Under our plan, the business will continue to operate out of the UK, looking to maintain the long-standing and undoubted heritage of the brand.
“We will achieve this through a combination of working with quality British design and the business’s existing supply chain.”
Accounts for LK Bennett Fashion for the period ended January 27, 2024, show the company made a post-tax loss of £3.5m on turnover of £42.1m.
The figures showed a steep decline in sales from £48.8m in 2023.
Ms. Bennett founded the eponymous chain by opening a store in Wimbledon, southwest London, in 1990, and she promised to “bring a bit of Bond Street to the high street.”
Her eye for design earned her the nickname ‘queen of the kitten heel’ and saw her products worn by the Princess of Wales and Theresa May, the former prime minister.
In 2008, Ms Bennett sold the business for an estimated £100m to a consortium led by the private equity firm Phoenix Equity Partners.
She retained a stake and then bought back the remaining equity in 2017.
The company’s administration in 2019 resulted in the closure of 15 stores.
Next declined to comment, but an M&S spokeswoman stated that the company was not considering a bid for LK Bennett.
