Frasers Group PLC (LSE:FRAS)'s reported sale of fashion brand Missguided to Shein could mark a major milestone for Mike Ashley’s firm, according to Shore Capital brokers.
The deal would see Frasers sell Missguided just 18 months after rescuing the label from administration.
According to Shore Capital, it could also mark the start of a strategic partnership, with Chinese firm Shein on an “aggressive” trajectory to build its global footprint.
“A potential partnership with global online retail player Shein could represent a transformational milestone for Frasers,” brokers said.
Fraser’s solidified position in the UK through brands such as Sports Direct and House of Fraser could see it act as a distributor for Shein.
Shein could also list Fraser’s products on its online platform in return, the bank added, granting it exposure to some 120 million users.
Shore Cap backed Fraser’s with a “buy” rating, alongside a share price target of 805p - up on Monday’s opening.