High street bellwether Next has struck a joint venture deal to continue running Victoria’s Secret in the UK after its collapse, securing 500 jobs.
The lingerie company tumbled into administration in June as its woes were exacerbated following the forced closure of its 24 branches when the pandemic hit.
It employs around 800 staff in the UK, of which 500 are safe for now as Next renegotiates cheaper leases with landlords. Although there have been no redundancies yet some uncertainty hangs over the remaining roles.
L Brands, the US firm behind the Victoria’s Secret group, confirmed that Next will acquire the majority of the UK arm’s assets from insolvency. As part of the deal, the UK digital business will be folded into the joint venture next spring.
Marks & Spencer, which dominates the lingerie market at home, was also reportedly in the running to form a tie-up.
One source close to the arrangement said it was a "super smart deal".
Next will have a 51pc stake, with the rest remaining with the Victoria’s Secret owner. The terms of the deal were cloaked in secrecy and the move is subject to regulator clearance.
Martin Waters, chief executive officer of L Brands International, said: “We are pleased to take this next step in our profit improvement plan for Victoria’s Secret.
“Next’s capabilities and experience in the UK market are substantial and our partnership will provide meaningful growth opportunities for the business.”
Lord Simon Wolfson, chief executive of Next, said: “Next is very pleased at the prospect of working in partnership to expand the Victoria’s Secret brand in the UK and Ireland both in stores and online.”
Rob Harding, administrator at Deloitte, said: “This is an ideal way to secure the future of more than 500 employees in the UK.
“We are grateful to the creditors for working with us to deliver a solution that enables this business to survive and prosper.”
Shares in Next moved 1.2pc higher to £60.68 after the deal.