Next has bought a 25 per cent stake in fashion retail rival Reiss to form a "strategic partnership". Reiss, which has been a favourite of the famous including Britain's Duchess of Cambridge, has reported strong sales growth in recent years despite pressure on mainstream fashion retailers. Warburg Pincus, which has controlled Reiss since 2016, claimed the move valued the retailer at about £200 million (€234 million).
Next has said it will make an equity investment of £33 million for the stake, with a debt investment of £10 million, reflecting a potentially lower valuation. The retail stalwart added that it hopes its infrastructure capabilities can serve as a “launch pad” for Reiss’s growth plans in the UK and overseas. Reiss operates a number of Irish outlets, both in the Republic and the North.
Reiss will transition its online platform, warehouse, distribution and logistics to use Next's platform to run retail websites and back-end operations. The move will see Reiss boss Christos Angelides return to the fold at Next, where he worked for 28 years until 2014.
Next said that Mr Angelides and his creative team will continue to lead Reiss. Before the impact of the pandemic, Reiss reported a 22 per cent jumped in turnover to £227.4 million in its last reported full-year up to February 2020.
Outstanding brand
Lord Simon Wolfson, chief executive of Next, said: "Reiss is an outstanding brand with enormous potential and a first-class management team. "We are excited to see what can be achieved through the combination of Reiss's exceptional product, marketing and brand building skills with Next's Total Platform infrastructure.
Mr Angelides, Reiss chief executive, said: “I believe the partnership with Next will be transformational for Reiss’ operational effectiveness.
Next’s infrastructure will ensure Reiss is not only more efficient as a business but more effective at serving its customers directly through Reiss stores, at reiss.com and through its worldwide partners.” – PA
