Fast-growing retail giant Next is currently in talks with Davidson Kempner Capital Management, a major US investment firm, regarding a joint bid for the failed group Arcadia. This bid would potentially put well-known brands such as Topshop, Burton, and Dorothy Perkins under Next’s control. Next is known for being one of the best-run fashion retail operations in Britain, being highly profitable and committed to physical stores, with a significant portion of its business coming from online sources. However, despite its success, Next is looking for an external investor to help reduce the capital required to invest in Arcadia. Talks with Davidson Kempner Capital Management are reportedly detailed, and while a bid is likely, nothing is certain. Next has also been in discussions with other potential financial partners.

There are other potential bidders for Arcadia, including Mike Ashley’s Frasers Group, American giant Authentic Brands, and e-tailer Boohoo. If Next were to acquire Arcadia, it would be a bold move, but partnering with an investor could help alleviate the financial burden. Next has been expanding its business through licensing deals, which require less capital investment. Recently, it has obtained licenses for Victoria’s Secret UK stores, as well as Ted Baker’s kidswear and lingerie lines. However, the question remains as to how many of the Arcadia stores Next would want to continue operating if their bid is successful.

According to a source, Next Chief Executive Simon Wolfson is keen on keeping a significant number of Topshop outlets open. As for the other brands under Arcadia, such as Evans, Wallis, Miss Selfridge, Burton, and Outfit, their future remains uncertain. The deadline for bids for Arcadia is Monday, adding urgency to the negotiations and decision-making process.

Useful links:
Next Official Website
Davidson Kempner Capital Management Official Website