Mike Ashley’s Frasers Group buys Missguided for £20m
Reports said that around 80 employees were sacked over phone FILE PHOTO: Sofia Richie and CEO of Missguided Nitin Passi arrive at the Sofia Richie x Missguided launch party at Bootsy Bellows on September 18, 2019 in West Hollywood, California. (Photo by Morgan Lieberman/Getty Images)
ONLINE fashion retailer Missguided has been bought out of administration by Mike Ashley’s Frasers Group for £20 million, according to reports.
Missguided, founded by Nitin Passi, fell into administration on Monday (30) when it failed to secure a last-minute buyer to overcome the financial crisis. The company was issued with a winding-up petition by clothing suppliers who are owed millions of pounds, putting about 140 jobs at risk, it was reported last week.
Ashley’s firm said it acquired certain intellectual property of Missguided Ltd and other related firms Mennace Ltd and Missguided (IP) Ltd, in a purchase funded from working capital. Frasers owns the brands Sports Direct, House of Fraser and Flannels.
Following the deal, Missguided will continue to be operated by the administrator under a transitional agreement for about eight weeks before it becomes a standalone business within the Frasers Group, media reports said.
Meanwhile, reports said that around 80 employees were sacked over phone via a pre-recorded message and then automatically muted, the MailOnline reported.
Reports also said that security guards were stood outside the Manchester headquarters on Wednesday (1) and were checking every staff members ID against a list to make sure those entering the building had kept their jobs.
Michael Murray, the chief executive of Frasers Group, said the company was “delighted to secure a long-term future for Missguided”. “Missguided’s digital-first approach to the latest trends in women’s fashion will bring additional expertise to the wider Frasers Group,” he said.
The firm founded in 2009 got into financial difficulties last autumn. It was saved from collapse when the private equity firm Alteri stepped in, buying a controlling stake and taking seats on the board. Passi subsequently left the company.
According to reports, more than a dozen UK suppliers reported they are collectively owed millions of pounds for orders, some of which were placed as late as last month.
Though there were talks about rival brand Boohoo stepping in to save Missguided, the talks were ultimately unsuccessful.
Missguided initially enjoyed rapid growth in its UK home market before expanding into the US, Australia, France and Germany.
Ashley recently bought struggling brands including Evans Cycles and the online specialist Studio Retail.