ASOS PLC (LSE:ASC) has announced the creation of a new joint venture in which 75% of its Topshop and Topman brands will be controlled by Heartland, the holding company of Danish multinational clothing business Bestseller.
Heartland, which was already a major ASOS shareholder, will control 75% of the joint venture with ASOS controlling the rest.
Topshop and Topman were valued at £180 million via the establishment of the joint venture, with ASOS receiving £118 million after expenses from Heartland.
The topshop.com web portal, which went offline in 2020 after the business went into administration before being acquired by ASOS in 2021, will relaunch within six months of the transaction closing.
“The new joint venture has the opportunity to expand Topshop and Topman's customer reach through selected wholesale partners - both online and offline - to bring customers globally the best that the brands have to offer,” ASOS said in a regulatory statement.
ASOS has struggled with a tumbling valuation since it purchased the Topshop, Topman, Miss Selfridge and HIIT brands from Philip Green’s Arcadia for £265 million in early 2021.
From heights of 5,770p at the time, the stock has since crumbled more than 90%.
ASOS intends to use the proceeds of the sale to reorganise its debt profile. It separately announced a £250 million bond refinancing to help strengthen the balance sheet.
Lise Kaae, chief executive of Heartland, said: "We are pleased to enter into this joint venture with ASOS, bringing the best of the Topshop and Topman brands to customers globally while supporting ASOS' strategy to obtain a more efficient capital allocation.
“We are committed to and look forward to working closely with our partners in a strong alliance."
There was no mention of Topshop reopening on the high street. It had over 300 UK stores at its peak before folding in 2020.