Next and Tom Joule swoop in to buy Joules for £41m, 1,450 jobs saved
After pulling out of a deal to buy a minority stake, the company going into administration and TFG having looked like it would win the prize, Next has emerged victorious in the race to buy the failed-but-still-popular Joules.
Importantly too, the company has linked up with Joules’ founder Tom Joule to take control of the business and will continue to operate 100 of its stores. Some 24 stores will close, but 1,450 jobs have been saved out of a 1,600 total and the operation will retain “management autonomy and creative independence”.
It’s a good result for Joules, especially given Next’s most recent purchase was another failed business, Made.com, where it only bought the brand with big job losses ensuing.
The £41 million deal came after Next jumped in with a last-minute bid on Thursday morning, just as it seemed TFG (the Whistles, Hobbs and Phase Eight owner) would emerge as the new owner.
With Tom Joule being part of the bid, it was always likely he’d want to keep the physical stores business that he’d built from scratch going if he could.
It’s also thought that M&S and Frasers Group had shown interest in buying the brand.
The company went into administration last month but the administrators said there was plenty of interest in buying it and it always seemed likely that it would be picked up by one of the big names operating in UK retail.
HQ SURVIVES, 24 STORES TO CLOSE
Next has said it will retain the firm’s Market Harborough head office and that of the 24 shops to be axed, 19 will close as of today. The stores staying open will still need to strike deals with landlords, something made easier by the administration process.
The Joules website, which has had its problems in recent years, will move to the slick Next Total Platform that already powers webstores for Gap and Victoria’s Secret in the UK.
Next chief Simon Wolfson said the business is “excited to see what can be achieved through the combination of Joules’ exceptional product, marketing and brand-building skills with Next’s Total Platform infrastructure”.
So what are the details? Next now owns 74% of the business with Tom Joule owning 26%. That’s a big advance on the 25% stake Next had been in talks to buy earlier this year, a deal that came to nothing as Joules’ situation deteriorated and its value plunged.
The Joules stores closing immediately are Carmarthen, Cheltenham, Chichester, Edinburgh, Exeter, Gateshead, Lyme Regis, Newbury, Northcote Road (London), Oxford, Peak Village (Derbyshire), Peterborough, Reigate, Salcombe Fore Street, Sherborne, Southwold Little Joule, St David’s, Waterloo station, and Watford.
Tom Joule said the business now needs to “live up to the high standards” customers look for as far as design, quality and service are concerned and that he’s looking forward to working to “recapture the imagination of the customer again”.
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