Asos approached in £1bn takeover bid by Turkish fast fashion peer
A Turkish retailer backed by Chinese e-commerce giant Alibaba has reportedly offered a £1bn bid to take over Asos, in a fresh knock of confidence for the future of the digital fashion brand.
Trendyol, an up-and-coming fast fashion retailer, was understood to have approached Asos in late December, when the brand was facing dwindling sales and operational changes, according to reports in The Times.
The Turkish platform, which launched in 2010, is said to have been working with Morgan Stanley to make the offer, and also approached one of Asos’s leading investors, Danish billionaire Anders Povlsen, to see if he would be interested in participating in the deal.
Asos was once the poster child for pandemic success, enticing bored consumers stuck at home to splurge on its loungewear and clothing – in 2021 its half year profits tripled to £106m.
At the height of its success, Asos also beat off a number of top bidders, including Mike Ashley for Philip Green’s crumbling Arcadia empire, which included high street darling Topshop.
The £330m acquisition showed investors the power of not only Asos but also the digital shopping space as the future of brick-and-mortar retailers hung in the balance mid pandemic.
However, fast forward two years and Asos has disappointed the markets through a series of unfavourable financial results and – most recently – a £75m cash call from investors to repair its balance sheet.
In the background, efforts to turn around the retailer are being made by chief Jose Antonio Ramos Calamonte, who last year launched a “driving change” initiative to repair the group’s finances – which have included reduced markdowns and new discipline on “marketing spend”.
But the market is yet to see the results of these turnaround plan, with Asos having been booted off the FTSE 250 last week as its shares fell to a 12-month low.
Asos shares traded between £6.79 and £4.86 in December.
Shares closed at £3.50 when markets closed on Friday.
City PM has approached Asos and Trendyol for a comment.