Next has acquired most of upmarket clothing retailer Joules out of administration for £34mn and will run the company in partnership with its founder, Tom Joule.
About 100 stores will be retained and Next will also acquire the Joules head office, located near its own campus in Leicestershire, for £7mn. Nineteen stores employing 133 staff will close, according to a statement from administrators Interpath.
Joule, who will own 26 per cent of the venture, said he was “pleased that we have been able to strike a deal that protects the future of the company”.
He had recently returned to the company as product director, having stepped back to a non-executive role in 2019. The two companies said he would “take the lead in re-establishing the clear identity of both brand and product” for Joules.
The two companies had previously been in talks after Joules, which sells clothing inspired by British country lifestyles and counts Catherine, Princess of Wales and Taylor Swift among its customers, ran into financial trouble as demand stagnated. But the two sides were unable to reach an agreement and the talks ended in September.
Next chief executive Lord Simon Wolfson said he was “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”.
Total Platform provides online marketing, customer service and logistics functions to brands that lack the resources or management expertise to build or expand these capabilities themselves.
Joules’ products will be transferred to the platform in 2024, the delay arising partly because Next is currently working on a capacity expansion at its main warehouse facility.
Reiss, Gap UK, Laura Ashley, Victoria’s Secret and JoJo Maman Bebe are also platform clients. Next expects to make pre-tax profit of £21mn from its platform operations this year, most of which will come from its equity stakes in the companies operating on it rather than through the provision of services.
Like other platform clients, Joules will retain its own management team and creative independence.
The transaction is the second purchase out of administration for Next in the past month. In November it acquired the brand and intellectual property of Made.com for £3.4mn, just over a year after the furniture retailer floated on the stock market with a £775mn valuation.