The UK arm of lingerie brand Victoria’s Secret has found itself at the centre of a battle between Marks and Spencer Group PLC (LON:MKS) and Next PLC (LON:NXT).
According to a Sky News report, the two high street giants are vying to become the UK franchise partner of the brand’s parent company, with at least one other party also having expressed an interest in the deal.
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The process was triggered back in May when Victoria’s Secret announced that its UK arm would enter insolvency, although the management is still in charge of the group under a process known as ‘light touch’ administration.
Despite this, the brand has reopened around a third of its UK stores after striking revised rent deals with several landlords.
If M&S is successful in its bid to take control it will tighten its grip on the UK lingerie market, in which it already controls around 27%, however, Next could edge out the firm due to its success in selling third-party brands in its stores.
Victoria’s Secret’s troubles, having struggled financially in the UK before its insolvency, reflect pressures on brick and mortar retailers as a decline caused by the rise of online shopping has been accelerated by the lockdowns during the pandemic, leaving many firms relying on their online operations to continue shifting stock.
Shares in M&S were 1% higher at 103.2p in lunchtime trading, while Next was up 0.7% at 4,855p.